WASHINGTON – Legislation to reauthorize the Federal Aviation Administration (FAA) now includes a fix for the Small Business Administration (SBA) Duplication of Benefits loan issue affecting Louisiana residents hit by flooding in 2016.
U.S. Sen. Bill Cassidy, R-La., announced the inclusion Wednesday of several provisions as part of the Disaster Recovery Reform Act after the Senate Commerce Committee released an updated version of a Senate substitute amendment to H.R. 4 to reauthorize the FAA.
“There are thousands of people in the great floods of 2016 who were told to get an SBA loan and then found that they could not get a Restore Louisiana recovery grant because of some dumb quirk in the law,” Cassidy said.
“It makes no sense for these folks, trying to do the right thing, doing what they’re told, to then be denied access to a Restore Louisiana recovery grant. This bill fixes that,” he said.
“It ensures that those folks so affected can finally get the resources they need to complete the recovery and rebuild.
Sen. Ron Johnson, R-Wis., a member of the Senate Commerce Committee and chairman of the Homeland Security and Governmental Affairs Committee, agreed to offer the provisions, Cassidy said.
“I’m very grateful to my friend and colleague Sen. Ron Johnson for working with me and agreeing to offer these amendments on behalf of everyone caught in this no-win situation and the Great Flood of 2016,” Cassidy said.
H.R. 4 reauthorizes the FAA, Transportation Security Administration and National Transportation Safety Board.
Once H.R. 4 passes the Senate, a conference committee will be convened with the House to reconcile differences between the House and Senate versions of the bill.
The duplication of benefits issue is now remedied in both versions, making it likely the fix will be included in the final legislation.
The sections included in the revised H.R. 4 are:
Section 9010 - Duplication of Benefits:
Eliminates federal duplication of benefits restrictions directly affecting homeowners approved for or having drawn down SBA disaster loans as they seek to rebuild.
Currently, federal disaster homeowners who qualify for SBA loans are prohibited from seeking Community Development Block Grant Disaster Recovery (CDBG-DR) funding to either repay their SBA disaster loans or use it to supplement assistance for recovery purposes.
This measure modifies the Stafford Act to ensure this duplication of benefits language interpretation does not continue to penalize disaster victims approved for SBA loans, then find themselves unable to receive CDBG-DR funds.
Section 9019 - Right of Arbitration:
Modifies the right of arbitration procedures by adopting the arbitration procedures used for hurricanes Katrina/Rita as opposed to the arbitration process provided for in Hurricane Sandy.
This process would be used for all significant disputes with FEMA over project worksheets and would provide for a neutral arbitration process that would use the Civilian Board of Appeals as the independent arbitration board that resolves any disputes that applicants may have with FEMA.
Section 9034 - Flood Insurance:
This waives Sec. 406 (d) of the Stafford Act that requires under the National Flood Insurance Program (NFIP) a $500,000 per facility deduction for schools, law enforcement and other public facilities that did not maintain flood insurance.
This measure ensures the $500,000 penalty applies only to one building per campus as opposed to each individual building on campus.
Section 9014 - Private Nonprofit Facility:
This section clarifies that food banks, such as the Baton Rouge Food Bank, are eligible for disaster relief.
Food banks are typically the first organization to begin distributing food well before FEMA or other private charitable groups arrive on the scene.
This language would make domestic hunger relief entities, such as food banks, along with long-term recovery groups, eligible to be reimbursed by FEMA for their disaster-related expenditures.
Section 9028 - Guidance on Inundated and Submerged Roads:
This requires FEMA and the Federal Highway Administration (FHA) develop and issue guidance to states regarding how they plan to reimburse states and localities for damages caused by flooding and/or other natural disasters.
Currently, there is no clear guidance regarding repairing/replacing inundated and submerged roads damaged or destroyed by a major federal disaster.
FEMA is not willing to reimburse states and localities any funding for damages caused by flooding or other natural disasters to roads even though in many cases these roads have been clearly damaged by these natural disasters.