By Ed Somers
October 17, 2005

Congress approved and the President signed a bill (S. 1858) October 7, which would help local governments hit by hurricanes Katrina and Rita cover their operating obligations and pay police, fire, emergency management, public works and other critically needed personnel.

The bill, sponsored by Senator David Vitter (LA), would authorize the Federal Emergency Management Agency (FEMA) to make loans to local governments under the Disaster Assistance Loan Program, and transfers $750 million to this account from the $62 billion previously approved by Congress for hurricane recovery.

The United States Conference of Mayors has been advocating for such assistance since its mission to the Gulf Coast area, and stated in a September 29 letter to Congress from Conference President Long Beach Mayor Beverly O’Neill and Executive Director Tom Cochran, “As we learned during our recent fact-finding mission to Louisiana, Mississippi and Alabama, the mayors of these cities have lost most of their tax base and will soon be without the funds needed to pay first responders, public works employees, and other key local personnel that are leading the recovery effort. These local personnel are truly national assets in the recovery from Hurricanes Katrina and Rita, and these cities must not be allowed to go bankrupt.”

However, the bill contains language that would – for the first time in history – remove the possibility that community disaster loans be forgivable, if needed, due to the dire situation many of the impacted cities will continue to face in the months and years ahead.

The Conference worked with Senator Mary Landrieu (LA) in opposing this unprecedented action, sending a letter, which was read on the Senate floor. Nevertheless, the Senate insisted on this new language, with Senator Vitter and others saying that it was necessary to gain support for the bill from the House of Representatives.

The Conference of Mayors will work with members of the House and Senate to revisit this issue through other legislation.

The bill does contain a new provision, which eliminates the limitation that no more than $5 million be provided to any one entity.