Scalise Announces Release of FEMA's Community Disaster Loan Forgiveness Rules
Washington, DC -- Congressman Steve Scalise today announced that the U.S. Department of Homeland Security’s Federal Emergency Management Agency (FEMA) has released loan forgiveness rules for Hurricane Katrina Community Disaster Loans (CDL). Since being elected to Congress in 2008, Scalise has been a strong voice in pushing FEMA to release these rules.
“This is an issue we have been pushing FEMA to address for more than a year,” Scalise said. “Today's news is a positive sign in our recovery process, but I will work closely with the administration to make sure they follow through with their commitment as each parish submits their applications. I applaud FEMA Administrator Fugate for responding to our requests to move the CDL forgiveness process forward.”
Local governments, fire departments, universities, and hospitals have been waiting for these regulations for more than two years. Most of them have continued to face large debts and continue to struggle with their recovery from Hurricane Katrina as a result. The will now be able to apply for forgiveness of more than $600 million in loans issued by FEMA as a result of Hurricane Katrina.
The CDL forgiveness rule allows those seeking cancellation of their Special CDL’s to contact the Governor’s Authorized Representative (GAR) before the loan due date, to notify the GAR that they intend to apply for cancellation. FEMA will then work with the applicant to assist them in submitting their Application for Cancellation. FEMA will cancel all or a part of an applicant’s Special CDL if the applicant’s revenues during the three fiscal years following Hurricane Katrina are insufficient to meet its operating budget.
Timeline of Scalise’s efforts:
December 2008, Scalise sent a letter to former FEMA Administrator David Paulison along with the Louisiana Congressional delegation regarding Katrina CDLs. The message of letter was: “The uncertainty and delay associated with this program has caused major financial problems for local governments and our hospitals; we strongly recommend that this process be expedited and that the issuance of these rules be a top priority of FEMA before the (Bush) Administration leaves office.”
February 2009, Reps. Scalise and Cao, and Sen. Vitter sent follow up letter to FEMA with the same message. Shortly after that letter, FEMA moved forward in the process and forwarded the draft regulations to OMB for their sign-off.
March 2009, FEMA released draft loan forgiveness guidelines for Hurricane Katrina CDLs
June 2009, Scalise met with Administrator Fugate and hand delivered documents to him requesting assistance for entities waiting on the forgiveness of CDLs including St. Tammany Parish and East Jefferson General Hospital.
October 2009, Scalise met one-on-one with Administrator Fugate in Scalise’s office in Washington D.C. During the meeting, Scalise asked Fugate about the thousands of outstanding Public Assistance projects, sought clarification on Hurricane Katrina Community Disaster Loan (CDL) forgiveness, and requested the Administrator’s support of the Disaster Recovery Improvement Act, H.R. 3453.
Throughout 2008 and 2009 Scalise and his staff met numerous times with Congressional leadership (including Majority Whip Rep. James Clyburn (SC) who authored the CDL forgiveness provision) as well FEMA staff in the Bush and Obama Administrations to continue moving this process forward.
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Contact: Luke Bolar
202-226-4309