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Congressman Garret Graves

Representing the 6th District of Louisiana

House passes $7.9 billion in Harvey disaster aid; no action on SBA loan restriction affecting 2016 flood victims

September 6, 2017
In The News

WASHINGTON — With federal disaster coffers stretched to the seams, the U.S. House of Representatives quickly passed a bill Wednesday to infuse $7.9 billion in disaster aid without taking amendments, pushing off a number of persistent questions about several federal disaster recovery policies.

Wrinkles in federal disaster regulations that have maddened victims of the 2016 Louisiana floods — chief among them a rule that drastically limits access to recovery grants for those approved for SBA loans — weren’t taken up in the bill, avoiding debate or wrangling that could delay urgently needed money.

The overwhelming vote on the package, billed largely as aid for the victims of Hurricane Harvey but also will replenish the fund the Federal Emergency Management Agency uses for a variety of recovery programs, sent the package to the U.S. Senate within hours of being introduced.

The vote came as hundreds of thousands of people in east Texas and southwest Louisiana began to muck out homes and businesses flooded by Harvey’s record-breaking rains — and as another, even more powerful storm, Hurricane Irma, menaces U.S. territories in the Caribbean and is taking aim at Florida.

The vast majority of the cash under the House-approved bill — passed 419-3 — would pour into FEMA’s Disaster Relief Fund, a pot the agency uses to pay emergency assistance to individuals and local governments as well as to fund disaster mitigation grants.

Four of Louisiana's congressmen voted in favor of the disaster aid package: Reps. Cedric Richmond, D-New Orleans; Ralph Abraham, R-Alto; Garret Graves, R-Baton Rouge; and Mike Johnson, R-Bossier City.

Two did not vote on the proposal: U.S. Rep. Clay Higgins, R-Port Barre, and U.S. House Majority Whip Steve Scalise, a Jefferson Republican who is still recovering from gunshot injuries from a mass shooting at a congressional baseball practice this summer.

“We will not leave before this gets done,” House Speaker Paul Ryan, R-Wis., pledged Wednesday just before pushing the bill through. “We have got another hurricane right now, Hurricane Irma headed to our shores, and it's critical that we act immediately.”

Graves said FEMA had recently clamped down on payouts of disaster money not related to Harvey as agency officials grew alarmed over their dwindling resources. Quick action by Congress, Graves said, would ensure FEMA payouts for previous disasters would continue flowing in addition to provided desperately needed help to those whose homes were decimated by Harvey.

“There is an awful amount of urgency in getting this done quickly, and Irma turned up the heat even more,” Graves said.

Gov. John Bel Edwards sent a letter Wednesday to leaders of the U.S. House and Senate again urging them to clear the SBA loan restriction, an issue that has angered the roughly 18,000 homeowners the Governor's Office estimates have been hit by the rule.

Many of the affected homeowners have said FEMA officials encouraged them to apply for SBA loans in the wake of the floods — only to find their loan approvals would later amount to a major barrier to getting money from the state’s federally funded homeowner recovery program.

Under the guidelines followed by the U.S. Department of Housing and Urban Development, which administers much of the longterm federal recovery money, flooded homeowners still could get grant money from the Restore Louisiana Homeowner Program — but with a major caveat. The Restore Louisiana money cannot duplicate loan awards, meaning the value of the SBA loan approval would need to be subtracted from any grant amount.

The restriction applies to all homeowners approved for SBA loans, not just those who used them or took out the full amount. For example, a homeowner who was approved for a $90,000 loan who took out only $30,000 — or even decided to skip a loan altogether — would still face a $90,000 reduction on money he or she could receive from the grant program.

"This simple fix will allow affected homeowners in both Texas and Louisiana to access funds that are critically needed and will help move the rebuilding process forward," Edwards wrote in the two-page letter.

But with leaders in the House of Representatives insisting on pushing the recovery money through quickly and avoiding any amendments that could bog down the bill, attempts to change that rule and others will have to wait.

Louisiana’s congressional representatives are generally in agreement with the governor over the SBA issue but haven’t yet been able to change the regulation. With Texas homeowners likely to face similar headaches in the months ahead, Louisiana’s delegation could find natural allies in pushing for changes.

Edwards, Graves and a number of other Louisiana leaders have repeatedly pointed out concerns over the SBA issue to U.S. Housing Secretary Ben Carson, whose agency administers much of the recovery money. Graves said Wednesday he believes the U.S. Department of Housing and Urban Development could fix the issue administratively by changing how it interprets of federal law.

State leaders also have highlighted several other changes they’d like to see to federal rules surrounding disaster recovery, including mandates that every home receive a separate environmental review. State officials and elected leaders have said streamlined reviews of whole subdivisions or neighborhoods would be as effective in protecting the environment while saving money and speeding the rebuilding process.

Congressional leaders from both parties described the $7.9 billion deal passed by the House on Wednesday as a down payment on the federal recovery assistance for areas hit by Harvey. And though the exact path of Irma remained unclear Wednesday, politicians were already anticipating the potential needs of areas of the U.S. in the storm’s projected course, including Florida, Puerto Rico and the Virgin Islands.

The House-backed package also includes money for SBA disaster loans but doesn’t include the kind of long-term recovery appropriations Congress generally passes following major disasters.

The $7.9 billion funding bill is expected to be attached to a short, three-month increase in the federal debt limit as well as a temporary three-month bill to fund the federal government under a deal between President Donald Trump and Democratic Capitol Hill leaders.

The president’s deal, struck at a White House meeting Wednesday, appeared to take Republican Congressional leaders by surprise. About an hour earlier, Ryan, the House speaker, had blasted suggestions by top Democrats to do just that as “ridiculous.”

A source briefed on the White House meeting said an array of top Republicans in the room — Ryan, Senate Majority Leader Mitch McConnell, House Majority Leader Kevin McCarthy and Treasury Secretary Steven Mnuchin — had urged Trump to insist on longer extensions of the debt ceiling and federal budget, arguing three-month deals would signal uncertainty to financial markets and offer Democrats additional leverage in future negotiations