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Menendez, Schumer push for faster Sandy recovery cash

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PostPosted: Sun Sep 22, 2013 3:50 pm    Post subject: Menendez, Schumer push for faster Sandy recovery cash
From Sep 22, 2013 to Sep 26, 2013 (included)
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WASHINGTON — As the one-year anniversary of Superstorm Sandy nears, senators from New Jersey and New York had tough questions Wednesday for administration officials over rebuilding efforts.

They also expressed concerns about flood insurance premiums that are set to skyrocket in coming months.

"Not everything is great. There are people still hurting," Democratic Sen. Robert Menendez of New Jersey told Housing and Urban Development Secretary Shaun Donovan at a hearing before the Senate Banking Subcommittee on Housing, Transportation, and Community Development, which Menendez chairs.

Both Menendez and Sen. Charles Schumer, D-N.Y., praised Donovan for his work heading the administration's task force overseeing Sandy recovery efforts, but called on Donovan to explain why almost a year after the Oct. 29 storm, some businesses and homeowners are still waiting for assistance.

"While we have made a lot of progress and we should be proud of that progress, it would be wrong to believe that we have overcome all of the challenges that were created by Superstorm Sandy," Menendez said.

Schumer acknowledged that it's largely up to local governments to distribute federal Community Development Block Grant money for Sandy rebuilding efforts, but he wondered if more could be done to speed up the process.

"Here we are nearly a year after Superstorm Sandy, and the most consistent question I get from my constituents is why they have not yet been able to either receive funding or reimbursement," he said.

Donovan said the Federal Emergency Management Agency did a "very good job" of getting initial disaster payments out, but he agreed with Schumer that the aid, which topped out at $30,000 per household, might not have been enough for many people in hard-hit parts of New Jersey and New York.

Special disaster assistance from HUD was supposed to make up the rest, and applications for those programs are starting to be paid out, although more outreach may be necessary, Donovan said.

“The most consistent question I get from my constituents is why they have not yet been able to either receive funding or reimbursement.”

— Sen. Charles Schumer, D-N.Y.
"The money is beginning to flow," he said, adding that administrative and legislative steps could be taken to speed up the process.

Donovan said problems arose because federal officials faced "dozens of different (insurance) policies and different lenders." So they asked the Federal Housing Authority and mortgage finance giants Fannie Mae and Freddie Mac to create a uniform policy for insurance disbursements.

Donovan said a 90-day moratorium on foreclosures for nonpayment of mortgages was instituted and a program put in place to make sure homeowners weren't faced with higher monthly payments for lapses.

In the event of a future disaster in a dense metropolitan area, he said, FEMA now has a plan in place to send in additional insurance adjusters.

As of July, FEMA and the Small Business Administration had helped more than 270,000 households and individuals, and nearly 4,000 businesses recover from Sandy, Donovan said.

He noted that 97% of public beaches from New Jersey to Connecticut had re-opened by Memorial Day. Additionally, 99.5% of Sandy-related National Flood Insurance Policy claims — totaling $7.8 billion — have been paid out, he said.

At a separate hearing Wednesday before the Banking Subcommittee on Economic Policy, Menendez and Schumer questioned FEMA Administrator Craig Fugate about newly implemented flood insurance premiums that they say are too expensive for low- and middle-income residents.

Congress passed a bill last year that will cut the federal subsidy for coverage through the National Flood Insurance Program by 25% a year over four years. A study on how to make the rates affordable has been postponed while the cuts are expected to go forward, something both senators challenged.

"While we work to get the study done, I don't believe that FEMA should be allowed to phase out the subsidies," Menendez said. "These consequences are for real people."

Schumer said it doesn't make sense to let flood insurance rates increase without an affordability study.

"There are many people who were ravaged by Sandy," he said. "And now they have their home insurance rates go up?"

Menendez introduced legislation in May that would spread the subsidy cuts over 10 years — with only a 5% reduction a year for the first five years. His bill would apply to all properties, including secondary homes, in flood zones.

Meanwhile, New Jersey businesses affected by last week's fire on the Jersey Shore may tap into federal money set aside for rebuilding after Superstorm Sandy, Donovan said Wednesday.

Donovan, speaking to reporters after the hearing on the progress of Sandy recovery, said block grant money will be available to assist businesses in Seaside Park and Seaside Heights.

"There's no question that if there's any relationship to Sandy, we can work closely with those communities to make sure that CDBG can be an effective tool to rebuild," Donovan said. "And even if it wasn't directly related, if they were still in the process of rebuilding from Sandy and something like this happens, we do have some flexibility to make sure that CDBG can be a tool."

Donovan said he has been in close touch with New Jersey officials about the fire and ways the federal government can help.

Authorities said this week an electrical wiring malfunction was the accidental cause of the fire that destroyed five blocks of the boardwalk. Ocean County, N.J., Prosecutor Joseph D. Coronato said the fire began under the boardwalk, where electrical wiring installed after 1970 was damaged by sand and saltwater during Sandy.

However, the wiring could have failed even had it not been damaged by the storm, he said.
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