Katrina Waste, Fraud, and Abuse Deterrence Act of 2005

Mr. President, I rise today to bring to the attention of the Senate a bill which provides a comprehensive package for immediate emergency resources to help the victims of Hurricane Katrina rebuild their lives and their businesses.

As we are well aware, the entire Gulf Coast of the United States has been ravaged by the disaster of Hurricane Katrina. No natural disaster in this country in recent memory has carried with it the devastation and horror we have witnessed in the recent weeks. Many lives have been lost and damages are projected in the hundreds of billions of dollars. The President and Congress have already provided over $61 billion in emergency funds.

While we work to re-establish communities and provide some stability to the affected areas, we must consider the enormous economic impact this catastrophe has had on the region and on our entire Nation. This impact is particularly pronounced for the vital small business sector. With over 800,000 firms damaged in the Hurricane-affected region, employment in the Louisiana, Mississippi and Alabama area may be reduced by over a million jobs! Moreover, our economy which has recently recovered from recession, thanks largely to our small businesses which have created three-quarters of all new jobs, could be dampened by as much as a full percentage point.

As Chair of the Committee on Small Business and Entrepreneurship, I am committed to do everything in my power to provide immediate and necessary support to rebuild this region and to help sustain our economy. I want to ensure that every American affected by this Hurricane has the resources to begin rebuilding their lives, their businesses and their dreams.

The provisions of this bill were contained in an amendment that I proposed, Amendment #1717, to the Commerce, Justice, and Science Appropriations Act of 2005, H.R. 2862. I would like to thank my colleagues, Senator Vitter, Senator Talent, Senator Kerry, and Senator Landrieu, for co-sponsoring that amendment. The amendment was approved in the Senate by a rollcall vote of 96 to 0 on September 15, 2006, and subsequently passed the Senate in the Commerce, Justice, and Science Appropriations Act on that same day.

Because the Federal Disaster Loan program administered by the Small Business Administration issues Disaster Loans to businesses, homeowners, and renters, this legislation would have a significant impact on many facets of the efforts to rebuild the areas damaged by Hurricane Katrina.

I will also be holding a hearing in the Small Business Committee on September 22, 2005 to address the impact that Hurricane Katrina has had on small businesses.

The Small Business Administration is and must be at the forefront of this massive relief effort, playing a significant role in assisting impacted communities. This bill will strengthen the SBA's resources and will enable them to pave the pathway to recovery. I have faith that American small businesses will persevere through these difficult times and help lead the region's recovery. It is essential that we work together here in Congress, and put forth the best possible proposal to stimulate our economy and foster job growth.

I have spoken with SBA's Administrator Barreto concerning the various ways to respond to this disaster and assist with the recovery. He informed me that FEMA has referred over 500,000 cases for loan assistance to the SBA, and that the SBA is receiving up to

20,000 calls per day. This is a tremendous volume and a vital challenge that the SBA must satisfy. To date, the SBA has sent out almost 500,000 applications for loans to individuals and businesses, and has received 810 loan applications as of Monday morning, which demonstrates that much assistance is yet to be provided by the SBA. Therefore, it is critical that we act now!

I firmly believe this legislation is the best possible package to aid families, businesses and communities through these challenging times. Small businesses must have a fighting chance to survive the economic disaster caused by Hurricane Katrina.

I have included many provisions in my bill that would assist hurricane victims applying for SBA disaster loans. My legislation increases the maximum size of an SBA Disaster Loan from $1.5 million per loan to $10 million per loan and makes it possible for non-profit institutions damaged by Hurricane Katrina to be eligible for Disaster Loans.

I have also provided the SBA with the authority to grant victims of Hurricane Katrina up to 12 months to begin repaying their SBA disaster loans which would assist both small and large businesses, homeowners, and renters. This 12 month period could be extended to 24 months at the discretion of the SBA Administrator if he determines that Katrina victims would need additional time to begin repaying their loans. This would allow also homeowners and businesses additional time to get their lives and businesses restored before being required to begin repaying loans.

This legislation also proposes lowering fees for the 7(a) program to make borrowing more affordable for small businesses outside the disaster areas, many of which have been impacted by the disaster, and are struggling to cover higher costs in health care and energy, and rising interest rates.

Recognizing the increased demand this disaster will place on all small business lending programs, the amendment proposes increasing the 7(a) lending program from a program level of $17 billion to $20 billion, and the 504 lending program from a program level of $7.5 billion to $10 billion. Both the 504 and 7(a) lending programs are funded entirely through fees, so the increases require no appropriation.

Moreover, this bill increases the program level for SBA Disaster Loans--Physical and Economic Injury--by approximately $800 million, requiring an appropriation of approximately $117 million. The Committee is concerned there will not be enough funding for disaster loans available to meet the scope of this disaster, given that the economic injury disaster loans alone for 9-11 amounted to about $1 billion, and the physical damage for Katrina is considered much more extensive.

The bill also includes a provision requiring the SBA to treat these special provisions as separate from the regular programs, to avoid increasing future subsidy rates, and therefore, the costs for borrowers who rely on those programs. This same protection was provided for emergency 7(a) loans after 9-11 and for the special disaster loans for 9-11.

Additionally, many small businesses in the disaster areas will require relief from making payments and interest on 7(a) and 504 loans they had before Katrina hit. Therefore, this amendment includes a provision that directs the SBA to cover the payments and interest on existing loans for up to two years, or until the small business can resume payments.

Similar to the Supplementary Terrorist Activity Relief (STAR) loans enacted by Congress after 9-11, this bill allows the SBA to provide similar loans with lower fees for small businesses located outside the disaster zones but are nonetheless indirectly impacted by Hurricane Katrina. The lower fees also provide the lenders with an incentive to lend to these businesses.

Importantly, the bill includes protections to mitigate recent reports of past misdirection of loans to non-disaster victims. The protections include requiring lenders to inform borrowers that they are receiving Katrina relief loans, requiring lenders to document to the SBA how the borrower was adversely affected by Hurricane Katrina, and for the Government Accountability Office to collect the explanations and report to the Senate Committee on Small Business and Entrepreneurship and House Committee on Small Business every six months, verifying loans are being used for the intended purposes. These added protections will ensure that only applicants who really need these loans to recover from the horrific effects of Hurricane Katrina will receive the loans.

Furthermore, the legislation authorizes $400 million to the affected state governments of Louisiana, Mississippi, Alabama, Texas, and Florida to provide emergency bridge loans or grants to small businesses in the disaster areas that have been adversely impacted by Hurricane Katrina and require immediate access to capital until they can secure other loans or financial assistance. The goal is to disburse the funds within seven days, and this measure is based on a successful program that helped victims of the hurricanes in Florida.

With the cost of Katrina relief and rebuilding estimated at over $100 billion, small businesses, particularly those located in the disaster area and that employ individuals in the affected areas, should receive their fair share of federal contracting and subcontracting dollars. My bill also attempts to provide critical assistance to small businesses that have been operating in the areas devastated by the Hurricane Katrina by expanding access to Federal contract and subcontracts.

Government projects provide solid business opportunities and prompt, steady pay for small businessmen and businesswomen. In addition, government procurement would open doors for many local small businesses to participate in the long-term reconstruction work in the Gulf Coast areas. Prior to the disaster, small construction companies in Alabama, Mississippi, and Louisiana brought home nearly $500 million in Federal contracts a year. Total small business contracts in the Gulf Coast region exceeded $3 billion a year. While many small businesses would benefit from other forms of disaster assistance, many of them are ready to get back to work and into business as soon as possible.

To that end, my bill designates the Hurricane Katrina disaster area as a HUBZone. A HUBZone designation would enable small businesses locating in the disaster area and employing people in that area to receive contracting preferences and price evaluation preferences to offset greater costs of doing business. The HUBZone program was created to direct federal contacting dollars to economically distressed areas. Extending the HUBZone designation to the Gulf Coast would bring needed businesses development tools to affected areas.

In addition, my bill would increase the maximum size of surety bonds from $2 million to $5 million for Katrina-related contracts. Small contractors vying for work need an increase in bonds to handle greater projects for Hurricane Katrina relief. Local small businesses in the Gulf Coast can use higher bonds to compensate for the damage to their assets from the Hurricane.

My bill would also direct the SBA, its resources partners, and the Federal offices of small and disadvantaged business utilization to create a contracting outreach program for small businesses located or willing to locate in the Katrina disaster area. Finally, my bill would establish small business contracting and subcontracting goals for all Katrina-related contracts and subcontracts to promote greater jobs creation and development, while providing reasonable flexibility to Federal agencies in meeting that goal in light of difficult circumstances on the ground.

Finally I would also like to comment on the funding levels provided for the SBA in this bill. I have authorized the appropriation of $24.25 million for grants to increase business counseling in the damaged areas for several SBA entrepreneurial development programs including: Small Business Development Centers (SBDCs); SCORE; Womens Business Centers (WBCs); Veteran's Business Centers, and Microloan Technical Assistance.

Our Nation's 25 million small businesses prove time and again to breathe new life into our economy, by growing at twice the rate of all firms. And when a disaster strikes, the spirit, determination and will of America's small

businesses help to create the firm economic foundation, propelling our nation's economic growth. Therefore, we in turn must create an atmosphere favorable for small businesses and provide this emergency package to the SBA. We must allow Nation's small businesses to do what they do best--``create jobs.''

I urge my colleagues to support this bill. Too much is at stake for small businesses, and the economy as a whole, to allow this critical legislation to languish. Congress must find essential agreement and fulfill its obligation to America's small businesses. Clearly, if we strive for anything less, we fail to support the backbone of our economy, our hope for new innovation, and the entrepreneurs reach for the American dream.

Mr. President, all along our Nation's coasts are harbors that were once full of the sights, sounds, and smells that accompany the fishing industry. Unfortunately, a number of factors are converging to lead to the loss of our Nation's vital fishing infrastructure, which is essential for the continuance of the commercial fishing industry. I have drafted legislation that will help to combat the loss of commercial access to our waterfronts and to support the fishing industry's role in our maritime heritage.

In July, I was contacted by Andy Hawke of Boothbay Harbor, ME, a lobsterman who explained that the local lobstermen's cooperative had recently come up for sale. Unfortunately, the local fishermen could not come up with the resources to purchase the cooperative's facilities, and they were looking for Federal assistance in order to keep this coastal property accessible to the commercial fishing industry. Their goal was to keep the cooperative in operation for the lobstermen of Boothbay Harbor and the ``upcoming youth who will be in the lobster industry.''

There was little assistance that I could offer beyond identifying some grant programs that might apply. I discovered quickly that there is no targeted, Federal program to help the commercial fishing industry gain or preserve access to waterfront areas. At the same time, the pressures that drive the commercial fishing industry from these vital pieces of industry infrastructure are mounting. I rise today to introduce legislation that would create a program to assist our Nation's commercial fishermen, the Working Waterfront Preservation Act.

I can best speak to this issue by pointing to the loss of commercial waterfront access in Maine. Only 25 of Maine's 3,500 miles of coastline are devoted to commercial access. Sadly, portions of Maine's working waterfront are being sold weekly and converted to other uses, most often second homes and condominiums.

The reasons for the loss of Maine's working waterfront are complex. In some cases, burdensome fishing regulations have led to a decrease in landings, hindering the profitability of shore-side infrastructure, like the Portland Fish Exchange. In other cases, soaring land values and rising taxes have made the current use of commercial land unprofitable. Property is being sold and quickly converted into private spaces and second

homes that no longer are the center of economic activity.

Maine's lack of commercial waterfront access has prompted the formation of a Working Waterfront Coalition. This coalition is comprised of an impressive number of industry associations, non-profit groups, and State agencies, who have come together to preserve Maine's working waterfront.

Preservation of the working waterfront is essential to protect a way of life that is unique to our coastal States and is vital to economic development along the coast. Maine's Working Waterfront Coalition identified 18 projects that would increase Maine's available working waterfront. These 18 projects would create or preserve over 875 Maine jobs. All that is needed is a modest investment in Maine's working waterfront.

The loss of commercial waterfront access affects the fishing industry throughout all coastal States. On August 28, 2005, a story appeared in the Providence Journal about the fishing port of Galilee in Rhode Island. Fishermen from Galilee are getting pushed out of the waterfront as their profitability shrinks and land values soar. This article detailed plans to create more condominiums in Galilee and $2 million beach houses marketed to buyers from Connecticut and New York.

On July 26, 2005, the Los Angeles Times ran a story on the disappearance of working waterfront in Florida. In June of this year, Governor Bush signed a law aimed at protecting that State's working waterfront.

On February 20, 2005, the Seattle Times profiled the Washington town of Anacortes's struggle with development and the future of this port. In this story, the city attorney and planner said that the biggest issue facing this town is whether they can continue to have a working waterfront, as Anacortes ``is still a real town where people are making a real living.''

Another region of the country where this bill will help the local community and stimulate economic growth is a region we have heard a lot about in recent news, the gulf coast. On September 6, 2005, the Houston Chronicle ran a story on the havoc caused by Hurricane Katrina to Alabama's fishing industry. This disaster hit the town of Bayou La Batre; it destroyed oyster beds, upended fishing boats, and damaged the docks and piers on which the fishing industry relies. The Working Waterfront Preservation Act would assist the victims of this storm in rebuilding the shore-side infrastructure vital to the industry.

No matter the coastal State, our Nation's fishermen are affected by the loss of access to commercial waterfront properties. I have drafted legislation targeting this exact problem, as no Federal program exists to assist States like Maine, Florida, Washington, and Alabama, which are trying to cope with the loss of this valuable infrastructure.

The loss of commercial waterfront access is apparent. The Working Waterfront Preservation Act would assist by providing Federal grant funding to municipal and State governments, non-profit organizations, and fishermen's cooperatives for the purchase of property or easements or for the maintenance of working waterfront facilities. The bill contains a $50 million authorization for grants that would require a 25 percent local match. Applications for grants would be considered by both the Department of Commerce and State fisheries agencies, which have the local expertise to understand the needs of each coastal State. Grant recipients would agree not to convert coastal properties to noncommercial uses, as a condition of receiving Federal assistance.

This legislation also has a tax component included. When properties or easements are purchased, sellers would only be taxed on half of the gain they receive from this sale. Taxing only half of the gain on conservation sales is a proposal that has been advanced by the President in all of his budget proposals. This is a vital aspect of my bill because it would diminish the pressure to quickly sell waterfront property that would then, most likely, be converted to noncommercial uses, and would increase the incentives for sellers to take part in this grant program. This is especially important given that the application process for Federal grants does not keep pace with the coastal real estate market.

This legislation is crucial for our Nation's commercial fisheries, which are coming under increasing pressures from many fronts. This new grant program would preserve important commercial infrastructure and promote economic development along our coast. I am committed to creating a Federal mechanism to preserve working waterfronts and will pursue this legislation during the 109th Congress.

Mr. President, I rise today to introduce the Assure Emergency and Interoperable Communications for First Responders Act of 2005--or EICOM--as a step towards improving emergency communications nationwide so no community experiences the communications failure we saw in parts of the Gulf Coast in the wake of Hurricane Katrina.

I want to thank my cosponsors, Senators Collins, Levin, Akaka, and McCain, for joining me in this effort.

The attack of 9/11 dramatically showed how vulnerable our first responders are in an emergency when they are unable to communicate with each other.

Four years after 9/11, solving the problem of interoperability remains the number one priority for our Nation's first responders.

Whether responding to a terrorist attack, natural disaster, fire, a missing child, or a fleeing suspect, police, fire fighters, emergency medical technicians and other responders still all too frequently arrive at the scene with incompatible communications equipment and can't share crucial, life-saving information with each other.

This puts at risk both the lives of our first responders and those they were sworn to protect.

I have previously introduced legislation that addresses the problems of interoperability. But Hurricane Katrina spotlighted an even more severe problem--operability--the need for systems that themselves can survive a disaster, either natural or manmade. Katrina has shown us that without a working communications system a coordinated response to an emergency becomes close to impossible.

This bill seeks to address the challenges of both interoperability and operability.

Hurricane Katrina blew down power lines, knocked out cell phone towers and wiped out regular phone service in blasts of wind and water. In too many areas the result was no regular or cell phone service and portable radios that slowly went dead because there was no way to charge the batteries.

What do you do when you are down to zero communications? Gulf Coast emergency officials were repeatedly reduced to using runners to communicate between command centers and first responders in the field.

And this is not the first time this has happened in the United States.

Some have suggested that the scenes out of the Gulf Coast had a third world quality about them. But runners? That isn't Third World. That is the ancient world. That is Athens in 490 BC when legend has it a runner covered 300 miles in a week to share information and coordinate the defense of the City of Marathon--thus the name of the race.

But certainly between 490 BC and the 21st Century we've made greater advancement in communications technologies than better running shoes.

This bill seeks to remedy the communications nightmare we saw in New Orleans and the Gulf Coast--and make sure we don't have the same nightmare in future disasters.

This bill establishes an Office for Emergency Communications, Interoperability and Compatibility--or ECIC--within the Department of Homeland Security, replacing and strengthening the present Office for Interoperability and Compatibility.

This new and stronger ECIC will be charged with finding ways to establish emergency communications capabilities when a terrorist attack, natural disaster or other large-scale emergency has damaged or destroyed usual communications and electrical infrastructure.

This bill also tells the Secretary of DHS to establish a comprehensive, competitive research and development program to identify and answer the policy and technology questions necessary to sustain emergency communications capabilities and achieve interoperability.

This includes promoting research through the Directorate of Science and Technology Homeland Security Advanced Research Projects Agency, (HSARPA) and considering establishing a Center of Excellence.

The bill also directs the Secretary of DHS to establish at least two pilot projects to help us develop and test working emergency communications systems for first responders and government officials that will survive a natural disaster or terrorist attack where there has been damage to or destruction to critical infrastructure.

Finally, this bill establishes a grant program for States and regional consortiums to develop and implement short-term and long-term solutions for emergency communications capabilities and interoperability. Total grant amounts would start at $400,000,000 for fiscal year 2006, rising to $1 billion by 2010.

9/11 showed us the danger of non-interoperable communications for our first responders and the people they try to protect. Lives were likely lost that day because some first responders didn't get the orders to evacuate.

Katrina showed us the further peril that comes with zero communications. First responders tried to react to the disaster but didn't know where to go or what to do.

And, again, we know lives were lost.

This is 21st Century America, not ancient Athens. We've moved beyond runners. We have technologies at our disposal undreamed of even just a few years ago and breakthroughs still to come.

Let's marshal our resources and summon our will and--with a sense of urgency--create communications systems that survive disaster so our first responders can do their jobs--helping others when lives are on the line and seconds matter.

I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. President, today I join Senators Dodd, Durbin, Coleman, Murkowski, and Murray to introduce the ``Advancing FASD Research, Prevention, and Services Act of 2005.'' I thank them for joining me in introducing this legislation that will improve the surveillance, identification, and prevention of Fetal Alcohol Syndrome Disorders or FASD.

FASD affects 1 in 100 live births or as many as 40,000 infants each year. This illness affects more people than those impacted by spina bifida, down syndrome, and cerebral palsy combined. In my home State of South Dakota, approximately 31,777 individuals are suspected of having FASD. This statistic is alarming and it is for these reasons why I believe that this bill is so critical in helping fight this disease.

During the course of my career, I have met and worked with people whose lives have been deeply affected by this preventable illness. For a person affected by FASD, there can be numerous medical, physical, educational, and financial implications, such as severe learning disabilities, physical abnormalities, costly medical bills, and behavioral impairments.

According to the University of South Dakota School of Medicine and Health Sciences Center for Disabilities, the lifetime cost for an individual with FASD is over $2 million, and the special educational costs for South Dakota children with FASD can range from $3,781 to $17,056 per year. Additionally, over 60 percent of the individuals in South Dakota who have been diagnosed with FASD lived within a foster care home for some part of their lives. While the foster care parent cares and loves a child, the child will never really know the stability of a permanent family.

Furthermore, it is estimated that 60 percent of individuals with FASD will end up in a correctional or mental institution at some point in their lives. Most individuals with FASD will commit their first crime between the ages of 9 and 14, costing the state of South Dakota close to $165.04 per day to house a juvenile offender with FASD, the total amount of all children with FASD in the South Dakota juvenile justice system and special education program is $3,810,240.

These unfortunate statistics compel me to join with my colleagues to introduce this bill today. While we have increased awareness about the dangers of consuming alcohol during pregnancy, there is much more that needs to be done to reach the goal of elimination of FASD in this Nation.

In my home State of South Dakota, we've had great successes in working on this issue. With the leadership of the health professionals at the USD Center for Disabilities, the Black Hills State University Western Center of Fetal Alcohol Syndrome, parents, and teachers, among countless others, we have been able to make some important advancements in addressing FASD. This legislation will bolster those efforts and those of many others across the country that are working hard to prevent FASD and support the children and families who are living with its consequences.

This bill would provide much needed support in the areas of research and prevention. This legislation would require the National Institutes of Health to develop a research agenda for FASD including research related to identifying the mechanisms that produce the cognitive and behavioral problems associated with fetal alcohol exposure, and identifying biological markers that indicate fetal alcohol exposure.

This bill would also make available Federal grants to community health centers to implement and evaluate programs to increase awareness and identification of FASD in those settings. Participating health centers would be able to make available training to health care providers on identifying and educating women who are at risk for alcohol consumption during pregnancy and also provide training to health care providers on screening children for FASD, among other things.

Another provision in this bill creates public awareness and education campaigns in at-risk. areas, in order to further the prevention of this disease. This bill would authorize the development and broadcast of national public service announcements to raise public awareness of the risks associated with alcohol consumption during pregnancy.

Again, I am pleased to be introducing this bill. I would also like to take a moment to thank Senator Daschle for his leadership on FASD. His long commitment to combating this illness is ever present in South Dakota and for those who continue to work with those battling FASD every day. Without his hard work and dedication, we would not be as far today in preventing FASD as we are.

Mr. President, our hearts go out to those who have been affected by the devastation wrought by Hurricane Katrina. By now, those who have been displaced by this disaster know that help is available to them. And true to the American spirit, assistance has poured in from people all across this great land. We have seen the Government, at every level, fail in some way to respond adequately to this emergency. Congressional hearings will examine these failures and the reasons for them to make sure that we are better prepared to respond in the future.

But there is no need for a review of the adequacy, efficiency, or responsiveness of everyday citizens who heeded distress calls from their fellow citizens. When the history of this disaster is finally written, it will document the fact that the American people rose to the challenge. Because that is what Americans do--every time, without exception.

Over the past several weeks we have seen ordinary Americans, on their own initiative, coordinate the donation of goods needed by evacuees, rent U-Haul trucks, and drive to New Orleans to deliver supplies. Others have initiated fundraisers and have donated substantial funds to aid the Red Cross and other charities that are on the ground. And still others, like those in my home State of Texas, have literally opened their doors to complete strangers to provide them with food, shelter, and other necessities, so that they can get back on their feet and begin to rebuild their lives.

Here in the Congress we have acted quickly, passing emergency relief appropriations of more than $60 billion dollars to get money into the devastated areas so people can be helped and areas can be rebuilt. The President has further proposed sending an unprecedented amount of money and incentives to aid in the rebuilding. I plan to support reasonable efforts designed to aid in accomplishing these goals. However, as we pour extraordinary amounts of money into the affected areas, we must guard against those callous people who may see this as an opportunity to wrongfully enrich themselves through fraud.

We all know that the Federal Government's track record at detecting and avoiding fraud is poor, at best. As we begin to funnel what some have said may be close to $200 billion dollars into the disaster areas, we must be vigilant to ensure that these funds go where they legitimately are supposed to go. And we must send the message here and now that the actions of those who may defraud the Government or otherwise illegally obtain a portion of these funds will not be tolerated.

That is why I have introduced the Katrina Waste, Fraud and Abuse Deterrence Act of 2005. This legislation states that anyone convicted of any crime involving funds appropriated for disaster relief in the aftermath of Hurricane Katrina face a mandatory minimum sentence of 5 years--and up to 20 years--in prison.

As I have said, a staggering amount of money will be, and currently is being sent to this area. The funds will speed the rebuilding of these areas and otherwise help those who are in need of assistance. But the American people will not tolerate misappropriation of these funds. President Bush has ordered that a team of inspectors general review all expenditures to ensure that the rebuilding work is done honestly and wisely. I applaud the President for his stewardship of this money. The bill I introduce today will put some teeth into this oversight. It will say to those who may contemplate illegally cutting corners or outright stealing disaster funds whether by fraud, theft, or embezzlement, that they will be caught, prosecuted, and imprisoned.

To those who legitimately need these funds: Your country is here to help you. To those who are inclined to take advantage of the misfortune of others by wrongfully taking these funds: You will be prosecuted.