Hurricane Katrina
GAO's Preliminary Observations Regarding Preparedness, Response, and Recovery Gao ID: GAO-06-442T March 8, 2006The size and strength of Hurricane Katrina resulted in one of the largest natural disasters in our nation's history. Hurricane Katrina raised major questions about our nation's readiness and ability to respond to catastrophic disasters. Hurricane Rita increased demands on an already stressed response and recovery effort by all levels of government. The two hurricanes provided a sobering picture of the overwhelming strains on response and recovery if there are back-to-back catastrophic disasters in the same area. GAO has a large body of ongoing work on a range of issues relating to all phases of the preparation, response, recovery, and rebuilding efforts related to Hurricanes Katrina and Rita.
Significant government and private resources were mobilized to respond to the hurricanes. However, these capabilities were clearly overwhelmed and there was widespread dissatisfaction with the results. Many of the lessons emerging from Hurricanes Katrina and Rita are similar to those we identified more than a decade ago, in the aftermath of Hurricane Andrew in 1992, which leveled much of South Florida. Four major issues have emerged from our preliminary work. The preparation and response to Hurricane Katrina are similar to lessons learned from past catastrophic disasters. These include the critical importance of (1) clearly defining and communicating leadership roles, responsibilities, and lines of authority for catastrophic response in advance of such events, (2) clarifying the procedures for activating the National Response Plan and applying them to emerging catastrophic disasters, (3) conducting strong advance planning and robust training and exercise programs, and (4) strengthening response and recovery capabilities for a catastrophic disaster. A risk management decision making approach is vital to develop the nation's capabilities and expertise to respond to a catastrophic disaster. Given the likely costs, Congress should consider using such an approach in deciding how best to invest in specific capabilities for a catastrophic disaster. Because of FEMA's mission performance during Hurricane Katrina, concerns have been raised regarding the agency's organizational placement, including whether it should be disbanded and functions moved to other agencies, remain within the Department of Homeland Security, or become an independent agency. However, other factors such as leadership and resources may be more important to FEMA's future success than organizational placement. Lastly, the federal government will be a major partner in the longer-term rebuilding of the Gulf Coast, supporting state and local efforts. The federal role in rebuilding will be particularly important for transportation and health infrastructures and federal facilities. In addition, federal programs will face financial difficulties and there is uncertainty about catastrophic losses affecting the availability and affordability of insurance. Long term rebuilding raises issues concerning the need for consensus on what rebuilding should be done, who will pay for what, and what oversight is needed to ensure federal funds are spent for their intended purposes.
GAO-06-442T, Hurricane Katrina: GAO's Preliminary Observations Regarding Preparedness, Response, and Recovery
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Testimony before the Senate Homeland Security and Governmental Affairs
Committee:
United States Government Accountability Office:
GAO:
For Release on Delivery Expected at 9:30 a.m. EST:
March 8, 2006:
Hurricane Katrina:
GAO's Preliminary Observations Regarding Preparedness, Response, and
Recovery:
Statement of David M. Walker:
Comptroller General of the United States:
GAO-06-442T:
GAO Highlights:
Highlights of GAO-06-442T, a testimony before the Senate Homeland
Security and Governmental Affairs Committee
Why GAO Did This Study:
The size and strength of Hurricane Katrina resulted in one of the
largest natural disasters in our nation‘s history. Hurricane Katrina
raised major questions about our nation‘s readiness and ability to
respond to catastrophic disasters. Hurricane Rita increased demands on
an already stressed response and recovery effort by all levels of
government. The two hurricanes provided a sobering picture of the
overwhelming strains on response and recovery if there are back-to-back
catastrophic disasters in the same area. GAO has a large body of
ongoing work on a range of issues relating to all phases of the
preparation, response, recovery, and rebuilding efforts related to
Hurricanes Katrina and Rita.
What GAO Found:
Significant government and private resources were mobilized to respond
to the hurricanes. However, these capabilities were clearly overwhelmed
and there was widespread dissatisfaction with the results. Many of the
lessons emerging from Hurricanes Katrina and Rita are similar to those
we identified more than a decade ago, in the aftermath of Hurricane
Andrew in 1992, which leveled much of South Florida. Four major issues
have emerged from our preliminary work:
* The preparation and response to Hurricane Katrina are similar to
lessons learned from past catastrophic disasters. These include the
critical importance of (1) clearly defining and communicating
leadership roles, responsibilities, and lines of authority for
catastrophic response in advance of such events, (2) clarifying the
procedures for activating the National Response Plan and applying them
to emerging catastrophic disasters, (3) conducting strong advance
planning and robust training and exercise programs, and (4)
strengthening response and recovery capabilities for a catastrophic
disaster.
* A risk management decision making approach is vital to develop the
nation‘s capabilities and expertise to respond to a catastrophic
disaster. Given the likely costs, Congress should consider using such
an approach in deciding how best to invest in specific capabilities for
a catastrophic disaster.
* Because of FEMA‘s mission performance during Hurricane Katrina,
concerns have been raised regarding the agency‘s organizational
placement, including whether it should be disbanded and functions moved
to other agencies, remain within the Department of Homeland Security,
or become an independent agency. However, other factors such as
leadership and resources may be more important to FEMA‘s future success
than organizational placement.
* Lastly, the federal government will be a major partner in the longer-
term rebuilding of the Gulf Coast, supporting state and local efforts.
The federal role in rebuilding will be particularly important for
transportation and health infrastructures and federal facilities. In
addition, federal programs will face financial difficulties and there
is uncertainty about catastrophic losses affecting the availability and
affordability of insurance. Long term rebuilding raises issues
concerning the need for consensus on what rebuilding should be done,
who will pay for what, and what oversight is needed to ensure federal
funds are spent for their intended purposes.
What GAO Recommends:
Today, we are making several recommendations to help reform the
nation‘s emergency preparedness, response, and recovery system. For
example, these include clarifying the roles and responsibilities of key
federal officials, clarifying various aspects of the National Response
Plan, and strengthening planning and response capabilities.
www.gao.gov/cgi-bin/getrpt?GAO-06-442T.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Norman J. Rabkin at (202)
512-8777 or rabkinn@gao.gov.
[End of section]
Madame Chairman and Members of the Committee:
I appreciate the opportunity to participate in today's hearing to
discuss our work stemming from the catastrophic hurricanes in the Gulf
Coast last fall. GAO has a large body of ongoing work on a range of
issues relating to all phases of the preparation, response, recovery,
and rebuilding efforts related to Hurricanes Katrina and Rita. We
currently have nearly 40 different engagements underway. Consequently,
my remarks today are preliminary, but well grounded in the work we have
done to-date as well as our completed work on prior disasters and
catastrophes. We also recently provided to this committee a summary of
the views of several groups regarding potential changes to the national
emergency response system. In the coming months, we will provide
Congress with more detailed findings, and a comprehensive summary of
what went well and why, what did not go well and why, and what specific
changes, if any, are called for in this nation's emergency
preparedness, response, and recovery system. In addition, based on the
work reflected in our recent testimony before the committee on fraud
and abuse related to the Individuals and Households Program, we plan to
issue recommendations to FEMA intended to strengthen fraud prevention
controls over the process for applying for disaster benefits, including
validating an individual's identity and damaged property
address.[Footnote 1]
Hurricane Katrina was one of the largest natural disasters in our
nation's history; its size and strength will have long standing effects
for years to come. It exacted terrible human costs with the loss of
significant numbers of lives and resulted in billions of dollars in
property damage. The fact that Hurricane Rita followed closely on the
heels of Hurricane Katrina only added to the destruction and suffering.
It also increased demands of an already stressed response and recovery
effort by all levels of government, especially in Louisiana. Moreover,
the two hurricanes provided a sobering picture of the overwhelming
strains on disaster response and recovery if there are back-to-back
catastrophic disasters in the same area.
Significant local, state, and federal resources were mobilized to
respond to the Hurricane Katrina disaster, along with significant
participation from charitable and private sector organizations.
However, the capabilities of several federal, state, and local agencies
were clearly overwhelmed, especially in Louisiana. Therefore, there was
widespread dissatisfaction with the level of preparedness and the
collective response. As events unfolded in the immediate aftermath and
ensuing days after Hurricane Katrina's final landfall, responders at
all levels of government--many victims themselves--encountered
significant breakdowns in vital areas such as emergency communications
as well as obtaining essential supplies and equipment.
The causes of these breakdowns must be well understood and addressed in
order to strengthen the nation's ability to prepare for, respond to,
and recover from major catastrophic events in the future--whether
natural or man-made. Unfortunately, many of the lessons emerging from
Hurricanes Katrina and Rita are similar to those we identified more
than a decade ago, in the aftermath of Hurricane Andrew in 1992, which
leveled much of South Florida. The experience of Hurricane Andrew
raised questions about whether and how national disaster response
efforts had incorporated lessons from experiences with Hurricane Hugo
in 1989. All critical players must do much more to learn from past
mistakes and actually implement recommendations that address prior
deficiencies in preparing for and responding to catastrophic disasters.
However, these actions will not be cost-free--posing a range of
challenges in determining the priority of various action steps and how
they will be funded.
GAO staff have visited areas most affected by Hurricanes Katrina and
Rita--Alabama, Louisiana, Mississippi, and Texas. They have interviewed
officials and analyzed information from the various involved federal
agencies such as the Department of Homeland Security's Federal
Emergency Management Agency (FEMA) and the Department of Defense (DOD);
state and local organizations, including state emergency management
agencies; state adjutant generals; local officials; and representatives
from nongovernmental agencies. I have personally toured southern
Mississippi, southern Louisiana, and the city of New Orleans. I also
have had discussions with many governmental and other officials,
including the governors of Alabama, Mississippi, Louisiana, and Texas;
the mayor of New Orleans; the principal federal official on the scene;
the joint task force commander of active duty forces, and the federal
coordinator for federal support for the Gulf Coast's recovery and
rebuilding. Additionally, we have closely followed the hearings
conducted by this Committee, the House's Select Committee to
Investigate the Preparation for and Response to Hurricane Katrina, and
other Congressional committees on Hurricane Katrina issues. We have
studied the House Select Committee report and are carefully reviewing
the recently issued White House report on lessons learned from the
federal response to Hurricane Katrina. Finally, we discussed our
preliminary observations with the Deputy Secretary of the Department of
Homeland Security.
In addition, we have done a great deal of work on prior disasters. In
1993, we conducted several reviews examining the federal response to
Hurricane Andrew. The reviews focused on the unique challenges involved
in responding to "catastrophic disasters."[Footnote 2] These reviews
defined "catastrophic disasters" as a subset of other disasters
requiring federal assistance. Unlike the bulk of the disasters
requiring FEMA to respond, catastrophic disasters can overwhelm the
ability of state, local and voluntary agencies to adequately provide
victims with essential services, such as food and water, within 12 to
24 hours. These prior GAO reports focused on improving the immediate
response to catastrophic disasters, and we made various recommendations
within this context. We recommended that, in a catastrophic disaster,
(1) a single individual directly responsible and accountable to the
President should be designated to act as the central focal point to
lead and coordinate the overall federal response when a catastrophic
disaster has happened or is imminent, (2) FEMA should immediately
establish a disaster unit to independently assess damage and estimate
response needs following a catastrophic disaster, and (3) FEMA should
enhance the capacity of state and local governments to respond to
catastrophic disasters by (a) continuing to give them increasing
flexibility to match grant funding with individual response needs, (b)
upgrading training and exercises for catastrophic disaster response,
and (c) assessing each state's preparedness for catastrophic disaster
response. We also recommended that Congress should consider (1) giving
FEMA and other federal agencies explicit authority to take actions to
prepare for catastrophic disasters when there is warning and (2)
removing statutory restrictions on DOD's authority to activate Reserve
units for catastrophic disaster relief.
Unfortunately, some of these recommendations were not adopted or in
effect when Hurricane Katrina hit the Gulf Coast. We continue to
believe, for the most part, these recommendations are still viable, as
we discuss later in this testimony. For example, current DOD strategy
calls for reliance on the reserve components (National Guard and
reserves) for civil support missions. Modifying statutory restrictions
to allow for the use of the reserves for catastrophic disasters would
provide greater access to Reserve units in the event they are needed
for future responses.
Other work we have conducted related to disaster preparedness and
management has involved programs to prevent or mitigate disasters or to
improve the capabilities and readiness of first responders. We have
identified needed improvements in a number of areas, including
preparedness for "all-hazards," balancing efforts to prepare for
emergency incidents resulting from terrorism and natural disasters or
man-made accidents; support for training, exercises, evaluations, and
disseminating lessons learned to first responders; and interoperable
communications for first responders. Similarly, our work on response to
disasters has identified a number of problems, such as the lack of
clarity of various federal, state, and local roles in coordinating the
response and medical and public health response capabilities.
Today, I will cover several major areas based on our preliminary work
related to the 2005 hurricane season. In summary:
* Four key themes underpin many of the challenges encountered in the
response to Hurricane Katrina and are similar to lessons learned from
past catastrophic disasters. These include the central importance of
(1) clearly defining and communicating leadership roles,
responsibilities, and lines of authority for response in advance of a
catastrophic disaster, (2) clarifying the procedures for activating the
National Response Plan and applying them to emerging catastrophic
disasters, (3) conducting strong advance planning and robust training
and exercise programs, and (4) strengthening response and recovery
capabilities for a catastrophic disaster.
* It is vital to have in place a risk management decision making
approach to develop federal capabilities and the expertise to use them
to respond to a catastrophic disaster. Given the likely costs, Congress
should consider using such an approach in deciding how best to invest
in specific capabilities for a catastrophic disaster.
* Because of FEMA's mission performance during Hurricane Katrina,
concerns have been raised regarding the agency's organizational
placement, including whether it should be disbanded and functions moved
to other agencies, remain within the Department of Homeland Security,
or again become an independent agency. Importantly, other factors, such
as the experience and training of FEMA leadership and the adequacy of
its resources may be more important to FEMA's future success than its
organizational placement.
* Lastly, the federal government will be a major partner in the longer-
term rebuilding of the Gulf Coast because of the widespread damage and
economic impact. In support of state and local efforts, the federal
role in rebuilding will be particularly important for transportation
and health care infrastructures and federal facilities. In addition,
federal programs will face financial difficulties and there is
uncertainty concerning the impact of catastrophic disasters on the
availability and affordability of insurance. Long term rebuilding
raises issues concerning the need for consensus on what rebuilding
should be done, where and based on what standards, who will pay for
what, and what oversight is needed to ensure federal funds are spent
prudently and for their intended purposes.
Background:
There are several federal legislative and executive provisions that
support preparation for and response to emergency situations. The
Robert T. Stafford Disaster Relief and Emergency Assistance Act (the
Stafford Act)[Footnote 3] primarily establishes the programs and
processes for the federal government to provide major disaster and
emergency assistance to states, local governments, tribal nations,
individuals, and qualified private nonprofit organizations. FEMA has
responsibility for administering the provisions of the Stafford Act.
Upon a governor's request, the President can declare an "emergency" or
a "major disaster" under the Stafford Act, which triggers specific
types of federal relief. The Stafford Act defines an emergency as any
occasion or instance for which, in the determination of the President,
federal assistance is needed to supplement state and local efforts and
capabilities to save lives and to protect property and public health
and safety, or to lessen or avert the threat of a catastrophe in any
part of the United States. Under an emergency declaration, the federal
government has authority to engage in various emergency response
activities, debris removal, temporary housing assistance, and the
distribution of medicine, food, and other consumables. The Stafford Act
places a $5 million limit on federal emergency assistance, but the
President may exceed the limit, followed by a report to Congress.
The Stafford Act defines a "major disaster" as any natural catastrophe
or, regardless of cause, any fire, flood, or explosion, in any part of
the United States, which the President determines causes damage of
sufficient severity and magnitude to warrant major disaster assistance
under the Stafford Act to supplement the efforts and available
resources of states, local governments, and disaster relief
organizations in alleviating damage, loss, hardship, or suffering.
Under a major disaster declaration, the federal government has the
authority to engage in the same activities authorized under an
emergency declaration, but without the $5 million ceiling. In addition,
major disaster assistance includes a variety of assistance not
available in the context of an emergency. For example, in a major
disaster, the federal government may provide unemployment assistance,
food coupons to low-income households, and repair, restoration and
replacement of certain damaged facilities, among other things.
For Hurricane Katrina, the President issued emergency declarations
under the Stafford Act for Louisiana on August 27, 2005 and Mississippi
and Alabama on August 28, 2005. The President made major disaster
declarations for Florida on August 28, 2005, and Louisiana,
Mississippi, and Alabama on August 29, 2005, the same day that
Hurricane Katrina made final landfall in the affected states.
The Homeland Security Act of 2002[Footnote 4] required the newly
established DHS to develop a comprehensive National Incident Management
System (NIMS) and a comprehensive National Response Plan (NRP). NIMS is
intended to provide a consistent framework for incident management at
all jurisdictional levels regardless of the cause, size, or complexity
of the situation and to define the roles and responsibilities of
federal, state, and local governments, and various first responder
disciplines at each level during an emergency event. NIMS established
the Incident Command System (ICS) as a standard incident management
organization with five functional areas--command, operations, planning,
logistics, and finance/administration--for management of all major
incidents. It also prescribes interoperable communications systems and
preparedness before an incident happens, including planning, training,
and exercises.
The Homeland Security Act of 2002 also required DHS to consolidate
existing federal government emergency response plans into a single,
coordinated national response plan. In December 2004, DHS issued the
National Response Plan (NRP), intended to be an all-discipline, all-
hazards plan establishing a single, comprehensive framework for the
management of domestic incidents where federal involvement is
necessary. It is to operate within the framework of NIMS. The NRP only
applies to incidents of national significance, defined as an actual or
potential high-impact event that requires a coordinated and effective
response by an appropriate combination of federal, state, local,
tribal, nongovernmental, and/or private-sector entities in order to
save lives and minimize damage, and provide the basis for long-term
community recovery and mitigation activities. The NRP does not apply to
the majority of incidents occurring each year that are handled by local
jurisdictions or agencies through established authorities and existing
plans under the planning assumption that incidents are typically
managed at the lowest possible geographic, organizational, and
jurisdictional level.
The NRP states that the Secretary of Homeland Security, as the
principal federal official for domestic incident management, designates
incidents of national significance, pursuant to the criteria in
Homeland Security Presidential Directive 5 (HSPD-5). HSPD-5 requires
one or more of the following to qualify as an incident of national
significance: (1) a federal department or agency acting under its own
authority has requested the assistance of the Secretary of Homeland
Security, (2) the resources of state and local authorities are
overwhelmed and federal assistance has been requested by the
appropriate state and local authorities,[Footnote 5] (3) more than one
federal department or agency has become substantially involved in
responding to an incident, or (4) the Secretary of Homeland Security
has been directed to assume responsibility for managing a domestic
incident by the President.
The Secretary of Homeland Security provides overall coordination for
incidents of national significance. Under the NRP, a principal federal
official (PFO) is to be personally designated by the Secretary of
Homeland Security for a particular incident and is to be the primary
point of contact and provide local situational awareness for the
secretary. Under the NRP, the PFO is to coordinate the activities of
the senior federal law enforcement official for the incident, the
federal coordinating officer (FCO) who manages and coordinates federal
resource support activities related to Stafford Act disasters and
emergencies, and other federal officials involved in incident
management activities acting under their own authorities. The PFO does
not have directive authority over these officials, but is to play a
coordinating function under the NRP. The Stafford Act requires that a
FCO be appointed to coordinate relief for major disasters and
emergencies declared by the President. The FCO retains this
coordination authority notwithstanding the appointment of a PFO under
the NRP.
The NRP can be partially or fully implemented in anticipation of or in
response to an incident of national significance. The NRP base plan
includes planning assumptions, roles and responsibilities, concept of
operations, and incident management actions. Annexes (i.e. appendixes)
to the NRP provide more detailed information on emergency support
functions such as transportation and communications and functional
processes and administrative requirements such as financial management
and international coordination. Incident annexes address contingency or
hazard situations that require specialized application of the NRP for
incidents of national significance.
The Catastrophic Incident Annex of the NRP references "catastrophic
incidents." The NRP defines a catastrophic incident as any natural or
manmade incident, including terrorism, resulting in extraordinary
levels of mass casualties, damage, or disruption severely affecting the
population, infrastructure, environment, economy, national morale,
and/or government functions. A catastrophic incident could result in
sustained national impacts over a prolonged period of time; almost
immediately exceeds resources normally available to state, local,
tribal, and private-sector authorities in the impacted area; and
significantly interrupts governmental operations and emergency services
to such an extent that national security could be threatened.
The Catastrophic Incident Annex describes an accelerated, proactive
national response to catastrophic incidents. The annex establishes
protocols to pre-identify and rapidly deploy key essential resources
that are expected to be urgently needed or required to save lives and
contain incidents. Expedited assistance can be provided in one or more
areas, such as mass care, housing, human services, urban search and
rescue, and public health and medical support.
A draft of a more detailed and operationally specific Catastrophic
Incident Supplement for the NRP's Catastrophic Incident Annex had not
been approved at the time of Hurricane Katrina, although the NRP's 120-
day schedule for implementing the supplement had passed. The draft
supplement is intended to provide the operational framework for
implementing the annex. The draft supplement, for example, includes
operations to be carried out by local, state, and federal responders;
detailed execution schedules and implementation strategies; functional
capability overviews (such as coverage for transportation support); and
key responsibilities of federal departments and agencies. The draft
supplement language says it is designed for catastrophic incidents that
occur with little or no notice, without an opportunity for advance
planning and positioning of resources. The Secretary of Homeland
Security is to make a catastrophic incident designation to activate the
provisions of the Catastrophic Incident Annex. Otherwise, the basic
provisions of the NRP will apply to the incident. The Secretary of
Homeland Security declared Hurricane Katrina an incident of national
significance on August 30, 2005, but never declared it a catastrophic
incident.
I will now turn to the four major topics I identified at the beginning
of my testimony.
Leadership, Planning, Exercises, and Capabilities Underpin Catastrophic
Preparation, Response, and Recovery:
Four key themes, based on our preliminary work, underpin many of the
challenges encountered in the response to Hurricane Katrina and reflect
certain lessons learned from past catastrophes. These are generally
consistent with the themes I highlighted in a statement to the House
Select Committee.[Footnote 6] They include the central importance of
(1) clearly defining and communicating leadership roles,
responsibilities, and lines of authority for the response at all levels
in advance of a catastrophic disaster, (2) clarifying the procedures
for activating the National Response Plan and applying them to emerging
catastrophic disasters, (3) conducting strong advance planning and
robust training and exercise programs to test these plans in advance of
a real disaster, and (4) strengthening response and recovery
capabilities for a catastrophic disaster, including those such as
emergency communications, continuity of essential government services,
and logistics and distribution systems underpinning citizen safety and
security. They have been among the topics covered in this committee's
hearings and were also highlighted among the many factors in the House
Select Committee report and the White House report.
Leadership Roles, Responsibilities, and Lines of Authority Must Be
Clearly Defined and Communicated in Advance of Catastrophic Disasters:
In the event of a catastrophic disaster, the leadership roles,
responsibilities, and lines of authority for the response at all levels
must be clearly defined and effectively communicated in order to
facilitate rapid and effective decision making, especially in preparing
for and in the early hours and days after the disaster. During
incidents of national significance, including catastrophic disasters,
the overall coordination of federal incident management activities is
executed through the Secretary of Homeland Security. Other federal
departments and agencies are to cooperate with the secretary in the
secretary's domestic incident management role.
There are three key roles in the management of a catastrophic disaster.
First, the Secretary of Homeland Security provides strategic, national
leadership. The Secretary of Homeland Security is to act as a focal
point for natural and manmade crises and emergency planning under the
provisions of the Homeland Security Act. In addition, HSPD-5, signed by
the President, also names the secretary as the principal federal
official for domestic incident management. This is consistent with our
recommendation in 1993 that a single individual directly responsible
and accountable to the President should be designated to act as the
central focal point to lead and coordinate the overall federal response
in the event of a catastrophic disaster.[Footnote 7] At the time of our
recommendation in 1993, FEMA was an independent agency. President
Clinton elevated the FEMA director to cabinet status in 1996.
Subsequent passage of the Homeland Security Act established the DHS
secretary as the cabinet-level focal point for natural and manmade
crises and emergency planning. We view this as a strategic role to
coordinate federal activities and policy from a national standpoint and
be directly responsible and accountable to the President.
The second key role is the principal federal official (PFO) whom the
Secretary of Homeland Security designates to be the secretary's
representative under the NRP structure and to coordinate the federal
response at an operational level. The third role is that of a federal
coordinating officer (FCO) which, under the Stafford Act, is to
coordinate relief for major disasters and emergencies declared by the
President.
The Secretary of Homeland Security initially designated the head of
FEMA as the PFO, who appointed separate FCOs for Alabama, Louisiana,
and Mississippi for Hurricane Katrina. However, it appeared there were
shifting roles and responsibilities of the players in all 3 of these
roles. Our initial field work indicated this resulted in disjointed
efforts of many federal agencies involved in the response, a myriad of
approaches and processes for requesting and providing assistance, and
confusion about who should be advised of requests and what resources
would be provided within specific time frames.
The House Select Committee also found difficulties with roles and
responsibilities, including federal officials' unfamiliarity with their
roles and responsibilities under the NRP and NIMS. The White House has
made numerous recommendations, including revising the NRP to address
situations that render state and local governments incapable of an
effective response, giving the PFO the authority to execute
responsibilities and coordinate federal response assets, and requiring
agencies to develop integrated operational plans, procedures, and
capabilities for their support to the base NRP and the NRP's emergency
support functions and support annexes.
Consistent with the provisions of the Homeland Security Act and the
Stafford Act, we recommend that DHS clarify and communicate the roles
of the secretary, the PFO, and the FCO. If legislative changes are
considered, the roles and responsibilities should be clarified
accordingly.
Procedures for Activating the NRP and Applying It to Emerging
Catastrophic Disasters Should Be Clarified:
The NRP distinguishes between incidents that require DHS coordination,
termed Incidents of National Significance, and the majority of
incidents occurring each year, such as snow storms, that are handled by
responsible jurisdictions or agencies through other established
authorities and plans. However, the NRP is not clear regarding what
triggers an incident of national significance. To illustrate this
ambiguity, the NRP's Planning Assumptions provide that "all
presidentially-declared disasters and emergencies under the Stafford
Act are considered Incidents of National Significance," indicating that
they do not need to be declared as such by the Secretary of Homeland
Security. Elsewhere, the NRP suggest that the Secretary must formally
declare an incident of national significance in consultation with other
department and agencies, as appropriate.
The question of how and when an event becomes an incident of national
significance was also raised in the White House report on the federal
response to Hurricane Katrina. According to the White House report, the
NRP did not make clear whether the secretary must formally declare an
incident of national significance or, alternatively, whether such an
incident is automatically triggered when one or more of the HSPD-5
criteria (discussed on page 8) are satisfied, including when the
President declares a disaster or emergency under the Stafford Act. In
addition, the White House report questioned whether an event becomes an
incident of national significance simply by satisfying an HSPD-5
criterion, or whether additional considerations apply. The White House
report observed that since the NRP was adopted in December 2004, many
parts of the NRP had been used to various degrees and magnitudes for
thirty declared Stafford Act events to coordinate Federal assistance.
Yet, the Secretary of Homeland Security had never formally declared an
Incident of National Significance until Tuesday, August 30, 2005, after
Hurricane Katrina made final landfall.
We agree that the process and operational consequences of declaring an
incident of national significance should be further defined and
clarified. Without such clarification of the NRP, confusion will
persist regarding DHS's activation of the NRP. We therefore recommend
that DHS clarify the NRP regarding whether the Secretary of Homeland
Security must formally declare an incident of national significance to
activate the NRP, and, if not, whether the secretary must take any
specific actions when the President, in effect, activates the NRP by
declaring a Stafford Act emergency or major disaster.
In addition, we believe that the NRP's provisions regarding the
proactive response of the federal government to emerging catastrophic
incidents should be clarified. As I stated earlier, the NRP includes a
Catastrophic Incident Annex that describes an accelerated, proactive
national response to catastrophic incidents and establishes protocols
to pre-identify and rapidly deploy essential resources that are
expected to be urgently needed to save lives and contain incidents. At
the time of Hurricane Katrina, a draft of a more detailed and
operationally specific Catastrophic Incident Supplement to the annex
had not been approved. Under the language of the draft supplement, the
annex would only apply to no-notice or short-notice catastrophic
incidents, not incidents that may evolve or mature to catastrophic
magnitude, which could be the case with strengthening hurricanes.
Because it is possible to respond to incidents maturing to catastrophic
magnitude in a more proactive manner than surprise catastrophic
incidents, it does not make sense to exclude evolving catastrophic
incidents from the scope of the annex's coverage. The White House
report on the federal response to Hurricane Katrina also questioned
this exclusion. As the White House report states, "Ultimately, when a
catastrophic incident occurs, regardless of whether the catastrophe has
been a warned or is a surprise event, the Federal government should not
rely on the traditional layered approach and instead should proactively
provide, or 'push,' its capabilities and assistance directly to those
in need."
A proactive approach to catastrophic disasters when there is warning is
also in keeping with recommendations we made in 1993 following
Hurricane Andrew. At that time, from an administrative perspective, we
recommended that FEMA improve its catastrophic disaster response
capability by using existing authority to aggressively respond to
catastrophic disasters, assessing the extent of the damage, and then
advising state and local officials of identified needs and the federal
resources available to address them. From a legislative standpoint, we
recommended that Congress should consider giving federal agencies
explicit authority to take actions to prepare for catastrophic
disasters when there is warning. We continue to believe that actions
such as these are warranted.
Planning, Training, and Exercises Can Aid Preparation for Catastrophic
Disasters:
Madame Chairman, to increase the ability of the nation to prepare for,
respond to, and recover from catastrophic disasters such as Hurricane
Katrina, there should be strong advance planning, both within and among
responder organizations, as well as robust training and exercise
programs to test these plans in advance of a real disaster. By their
very nature, catastrophic disasters involve extraordinary levels of
mass casualties, damage, or disruption that likely will immediately
overwhelm state and local responders, circumstances that make sound
planning for catastrophic events all the more crucial. Our previous
work on Hurricane Andrew highlighted the importance of such plans to
focus specifically on catastrophic disasters.
Our initial review of the NRP base plan and its supporting catastrophic
annex as well as lessons based on Hurricane Katrina suggest that
planning must be strengthened to implement their provisions. Therefore,
we recommend that these documents should be supported and supplemented
by more detailed and robust operational implementation plans. Such
operational plans should, for example, further define and leverage any
military capabilities as might be needed in a catastrophic disaster.
Prior catastrophic disasters and the actual experience of Hurricane
Katrina show that DOD is likely to contribute substantial support to
state and local authorities, including search and rescue assets,
evacuation assistance, provision of supplies, damage assessment assets,
and possibly helping to ensure public safety. More detailed planning
would provide greater visibility and understanding of the types of
support DOD will be expected to provide following a catastrophic event,
including the types of assistance and capabilities that might be
provided, what might be done proactively and in response to specific
requests, and how the efforts of the active duty and National Guard
would be integrated. We will be making several recommendations to DOD
to enhance its planning and response for future events, in the areas of
identifying specific active duty and National Guard capabilities that
would likely be available to respond to a catastrophe, and integrating
the active duty and National Guard response including Guard units
within and outside of the affected state. Planning also must explicitly
consider the need for, and management of, the contractor community.
In addition, regular training and periodic exercises provide a valuable
way to test emergency management plans. In our previous work on
Hurricanes Andrew and Hugo, we identified the need for the federal
government to upgrade training and exercises for state and local
governments specifically geared towards catastrophic disaster response.
Hurricane Katrina demonstrated the potential benefits of applying
lessons learned from training exercises and experiences with actual
hurricanes as well as the dangers of ignoring them. During our initial
fieldwork, we found examples of how an incomplete understanding of NRP
and NIMS roles and responsibilities could lead to misunderstandings,
problems, and delays. For example, we were told in Louisiana that in
one city there did not appear to be clarity in roles and
responsibilities, with officials not knowing what federal agencies were
responsible for. In one example in Mississippi, we were told that
county and city officials were not implementing NIMS due to a lack of
understanding of its provisions.
A November 2005 report by DHS's Office of Inspector General (OIG) on
the April 2005 "Top Officials 3 Exercise" noted that the exercise
highlighted--at all levels of government--a fundamental lack of
understanding regarding the principles and protocols set forth in the
NRP and NIMS, including confusion over the different roles and
responsibilities performed by the PFO and FCO. The report recommended
that DHS continue to train and exercise NRP and NIMS at all levels of
government and develop operating procedures that clearly define
individual and organizational roles and responsibilities under the NRP.
We would see this training and exercising effort as recognizing the
role of joint decision making and not result in a centralized, top-down
process.
The 2004 "Hurricane Pam" planning exercise illustrates the benefits and
consequences of applying and not applying lessons learned from training
exercises and experiences with actual hurricanes for future
catastrophic disasters. This catastrophic hurricane exercise, sponsored
by FEMA, was to develop a response and recovery plan for a major
hurricane that floods New Orleans and the surrounding parishes and to
identify any issues that could not be resolved based on current
capabilities. The weather scenario involved a slow moving category 3
hurricane sustaining 120 mph winds at landfall and generating a storm
surge that inundated New Orleans under 15 to 20 feet of water. In
addition to widespread flooding, the exercise posed impacts of
extensive evacuations and the resulting need to shelter thousands of
individuals left homeless after the storm, disposing of tons of debris,
and recreating school systems. We were told in Louisiana that the
exercise anticipated many of the events transpiring as the result of
Hurricane Katrina. The Hurricane Pam exercise and other planning
activities resulted in some action, but others were incomplete. For
example, efforts to finalize agreements with hospital and university
officials to create temporary medical operations staging areas around
the state did occur. Louisiana revised its contraflow evacuation plan.
However, plans for evacuating those with special needs and post-
landfall care and evacuation had not been finalized by the time
Hurricane Katrina made landfall. The House Select Committee also noted
that the Hurricane Pam exercise reflected recognition by all levels of
government of the dangers of a category 4 or 5 hurricane striking New
Orleans.
The White House has made several recommendations regarding planning and
exercises to improve the response to catastrophic disasters such as
Hurricane Katrina. For example, the White House recommends that all
federal departments and agencies should develop emergency plans and a
response capability. Other White House recommendations are intended to
strengthen training, exercises, and lessons learned. To illustrate,
recommendations cover (1) strengthening Homeland Security Council
coordination of federal emergency training, exercises, and lessons
learned, (2) DHS conducting state and local officials' training and
exercises, and (3) DHS establishing a national exercise and evaluation
program. The White House also recommended development of a
comprehensive homeland security professional development and education
program.
We recommend that DHS provide strong oversight of federal, state, and
local planning, training, and exercises to ensure such activities fully
support preparedness, response, and recovery responsibilities at a
jurisdictional and regional basis. This should also include applying
lessons learned from actual major and catastrophic disasters. We will
soon be starting work examining DHS's catastrophic planning
initiatives, including Hurricane Pam, in order to help identify more
specific recommendations.
Emergency Management Capabilities Require Greater Emphasis for
Catastrophic Response and Recovery:
The experience with Hurricanes Katrina and Rita highlights critical
emergency management capabilities that must be ramped up from normal
disaster management levels. Our preliminary work suggests that while
many organizations provided significant support in these areas during
the response and recovery efforts, several key capabilities were not
available when needed or with the quantity or quality needed. When
catastrophic disaster occurs, significantly more capabilities--in terms
of quantity and quality--are needed. Our work is beginning to identify
many examples of where the lack of additional response or recovery
capabilities, or the delay in getting these capabilities to where they
were needed, caused extended suffering.
I want to emphasize that across these capabilities, streamlining,
simplifying, and expediting decision making should quickly replace
"business as usual" and the unquestioned following of long-standing
policies and operating procedures. We were told of many examples where
quick action could not occur as agencies followed procedures that
required extensive, time-consuming processes, delaying the delivery of
vital supplies and other assistance. When there is a catastrophic
disaster, temporarily suspending certain rules and regulations may be
necessary in order to expedite relief and recovery of the affected
area, even if such a suspension requires legislation. The key is to
recognize when flexibility is needed to meet response and recovery
needs in a catastrophic disaster.
Continuity of essential government operations: Hurricane Katrina
exposed difficulties in continuing essential government operations,
particularly at the local level. In the devastated areas, local
government infrastructure was destroyed and essential government
employees, including many first responders, were evacuated or
victimized by the storms. Local officials in Mississippi and Louisiana
told us of cases where there was limited continuity of operations for
public safety and service agencies because both structures and
equipment were destroyed or too damaged to use. For example, one
Mississippi county lost all of its public buildings located south of
Interstate 10. We were also told criminal justice facilities in New
Orleans and St Bernard parishes were disabled as both jurisdictions had
to evacuate jails damaged by flood waters.
Emergency telecommunications: Agencies affected by a catastrophic
disaster must first be operable, with sufficient communications to meet
everyday internal and emergency communication requirements. Once
operable, they then should have communications interoperability whereby
public safety agencies (police, fire, EMS) and service agencies (public
works, transportation, hospitals, etc.) can communicate within and
across agencies and jurisdictions in real time. The storms
significantly damaged or destroyed communications infrastructure
affecting public safety and security in Louisiana, Mississippi, and
Alabama. This is an area where military capabilities can be utilized.
Our work on interoperable communications identified problem definition,
performance goals and standards, and defining the roles of federal,
state, local government and other entities as the three principal
challenges to achieving effective interoperable communications for
first responders. The single greatest barrier to addressing the decades-
old problems of interoperable communications has been the lack of
effective, collaborative, interdisciplinary, and intergovernmental
planning. No one first-responder group or governmental agency can "fix"
the interoperability problems that face the nation. We believe that our
2004 recommendations to the Secretary of DHS are still appropriate: (1)
work with the Federal Communications Commission to develop a nationwide
database of interoperable communications frequencies and a common
nomenclature so that first responders from different disciplines and
jurisdictions can quickly identify shared frequencies when arriving at
the scene of an incident; (2) establish interoperability requirements
whose achievement can be measured; and (3) through grants, encourage
states to establish statewide bodies that will develop a comprehensive
statewide interoperable communications plan and condition the purchase
of new equipment on the adoption of such a plan.
Damage and needs assessment: Damage and needs assessment is the
capability to immediately conduct damage assessments of infrastructure
and to estimate services needed by disaster victims. The scope of the
devastation and the flooding in the New Orleans area made a
comprehensive damage assessment and estimate of services victims might
need very difficult. Clearly, the military has significant capability
through a range of reconnaissance aircraft and satellite imagery.
However, while some capabilities were employed, there had been no
advance planning among federal, state, and local responders as to how
DOD would provide these capabilities in the event of a catastrophic
disaster.
Logistics: Logistics is the capability to identify, dispatch, mobilize,
and demobilize and to accurately track and record available critical
resources throughout all incident management phases. Our early work
indicates that logistics systems were often totally overwhelmed by
Hurricane Katrina. The result was that critical resources apparently
were not available, properly distributed, or provided in a timely
manner. In addition, acquisition efforts, while noteworthy given the
scope of Hurricane Katrina, indicated agencies needed additional
capabilities to (1) adequately anticipate requirements for needed goods
and services, (2) clearly communicate responsibilities across agencies
and jurisdictions, and (3) deploy sufficient numbers of personnel to
provide contractor oversight.[Footnote 8]
Evacuation: This capability involves evacuation to areas of safe refuge
in response to a potential or actual dangerous environment. Our early
work indicated that some evacuations were considered successful, but
others encountered serious challenges, including evacuating special
needs populations. Evacuating those in hospitals and nursing homes due
to Hurricane Katrina posed a special challenge. For example, although
the National Disaster Medical System (NDMS) is a mechanism through
which the federal government can provide assistance with patient
evacuations, NDMS has agreements with hospitals only and does not
address the needs of nursing homes.[Footnote 9]
Search and rescue: Search and rescue is the capability to coordinate
and conduct urban search and rescue response efforts for all hazards.
Search and rescue also requires a seamless transition from rescue to
safe shelter. The Coast Guard, state and local agencies, and military
assets rescued thousands in the aftermath of Hurricane Katrina.
However, particularly in New Orleans, those rescued may have been taken
to high ground where, because of flooding or roadway blockage, they
spent hours or days without shelter, food, or water.
Mass care (housing and human services): This is the capability to
provide immediate shelter, feeding centers, basic first aid, bulk
distribution of needed items, and related services to persons affected
by a large-scale incident, including special needs populations such as
those with physical or mental disabilities that need additional
attention. Charities and other organizations such as government
agencies that provide human services, supported by various federal
programs, helped meet the mass care needs of the hundreds of thousands
of evacuees. However, because the American Red Cross does not establish
shelters in areas that might become flooded or in structures that could
be compromised by strong winds, some Gulf Coast areas did not have
sufficient shelter facilities.[Footnote 10]
Volunteer management and donations: Volunteer management and donations
is the capability to effectively manage and deploy volunteers and
unsolicited donations. Federal and charity organization officials we
spoke to indicated that because of the catastrophic nature of the
storms, volunteers and donations, in some cases, were not well
integrated into response and recovery activities. In addition, federal
agencies involved in managing the international assistance were not
prepared to coordinate, receive, distribute, or account for the
assistance. Agency officials involved in the cash and in-kind
assistance told us the agencies were not prepared to accept
international assistance for use in the United States and, therefore,
developed ad hoc processes to address this scenario. We will be making
several recommendations to the Departments of Homeland Security,
Defense, and State to improve preparedness in these areas.
Restoration of lifelines: Restoration of lifelines is the capability to
manage clearing and restoration activities such as demolition, repair,
reconstruction, and restoration of essential gas, electric, oil,
communications, water, wastewater and sewer, transportation and
transportation infrastructure, and other utilities. Because of the mass
devastation, restoration is proceeding slowly.
Economic assistance and services: Economic assistance and services is
the capability to meet the demands for cash assistance, human services
programs, educational services, and family and child welfare services.
Our preliminary work indicated that a number of federal and state
programs provided assistance and services to eligible individuals and
families before the catastrophic disaster. Significant ongoing
assistance after the catastrophic disaster has also been required.
Secretary Chertoff has announced plans to emphasize several of these
capabilities in the near term. For example, DHS will acquire a hardened
set of communications capabilities, including equipment and specialized
reconnaissance teams to improve awareness about conditions and events
unfolding during a disaster. It was clear that DHS did not have
adequate situational awareness of how Hurricane Katrina-caused
conditions were worsening and thus required additional federal
response. As was noted during a hearing before this committee,
technological advances should provide the capability to prevent or
significantly reduce "the fog of war" during a catastrophe. The
secretary also has announced plans for better logistics and debris
removal capabilities.
The House Select Committee had findings in several of these areas, such
as medical care and evacuations, communications, emergency shelter and
temporary housing, and logistics and contracting systems. The White
House devoted a large number of its recommendations to capabilities.
For example, White House recommendations cover (1) developing a
National Emergency Communications Strategy and a modern, flexible, and
transparent logistics system, (2) reviewing and revising the NRP to
ensure effective integration of all federal search and rescue assets
during disaster response, (3) strengthening public health and medical
command for federal disaster response, and (4) assigning responsibility
for coordinating the provision of human services during disasters to
the Department of Health and Human Services.
Addressing these four themes--leadership; the clarity of the NRP;
advance planning, training, and exercises; and strengthening
capabilities for catastrophic events--will require developing
priorities and making trade-offs, given finite resources. A risk
management framework could aid agency and congressional decision making
on these issues.
Planning for a Catastrophic Disaster Calls for a Risk Management
Approach:
It is vital to have in place a risk management decision making approach
to develop federal capabilities and the expertise to use them to
respond to a catastrophic disaster. Given the likely costs, Congress
should consider using such an approach in deciding whether and how to
invest in specific capabilities for a catastrophic disaster.
Risk Management Is A Continuous Process:
We have advocated a comprehensive risk management approach as a
framework for decision making.[Footnote 11] Risk involves three
elements: (1) threat, the probability that a specific type of event
will occur; (2) the vulnerability of people and specific assets to that
particular event; and (3) the adverse consequences that would result
from the particular event should it occur. Another closely related
element is criticality, that is, the relative importance of the assets
involved, such as equipment, facilities, and operations.
We define risk management as a continuous process of assessing risks,
taking actions to reduce, where possible, the potential that an adverse
event will occur; reducing vulnerabilities as appropriate; and putting
steps in place to reduce the consequences of any event that does occur.
Risk management addresses risks before mitigating actions have been
applied, as well as risk that remains after countermeasures have been
taken. A risk management framework links strategic goals to plans and
budgets, assesses the value and risks of various courses of actions as
a tool for setting priorities and allocating resources, and provides
for the use of performance measures to assess outcomes and adjust
future actions as needed. The goal of risk management is to integrate
systematic concern for risk into the normal cycle of agency decision
making and implementation.
Risk Management Can Aid in Investment Decisions for a Catastrophic
Disaster:
Risk management can be central to assessing the risk for catastrophic
disasters. Our risk management framework calls for the management of
risk based on careful analysis of all available risk information,
identification of alternatives for reducing risks through preparation
and response, selection among those alternatives, implementing choices,
monitoring their implementation, and continually using new information
to adjust and revise the assessments and actions as needed, all within
available resources. As I mentioned earlier, we have identified several
key capabilities that may be needed in the event of a catastrophic
disaster such as emergency telecommunications, damage and needs
assessment, and logistics. Given that resources are finite, the
administration and Congress should consider using a risk management
approach in deciding whether and how to invest in specific capabilities
for a catastrophic disaster.
Some of the changes that the government will need to prepare for
catastrophic disasters are relatively inexpensive. Establishing more
robust surveillance and warning mechanisms should build on existing
systems, with communication of known information a key feature.
Developing more detailed plans for ramping up from a "normal" disaster
to a catastrophic disaster where warranted will impose additional
costs. Providing the needed training to ensure the readiness of first
responders and exercising the catastrophic disaster plans are much more
costly endeavors, as well as increasing the quantity and quality of the
federal government's preparedness and response capabilities.
A catastrophic disaster may be anticipated based on past history and
the expectation that there will be another catastrophic disaster.
Expectations, based on a risk management approach, would call for
building basic capabilities and contingency planning to leverage other
resources in anticipation of a likely event. For example, a major
earthquake in a major metropolitan area in California has occurred in
the past, is expected to occur at some point in the future, and is
likely to cause significant loss of life and extensive damage to
critical infrastructure. Flooding along the Mississippi River also has
occurred and would similarly cause widespread destruction and disrupt
the transport of goods along this major waterway. Man-made catastrophic
disasters that involve, for example, a nuclear power plant or liquefied
natural gas installations could cause catastrophic damage and deaths
across a wide area.
Specific Capabilities Can Be Identified:
Developing preparedness for large-scale disasters is part of an overall
national preparedness effort that should integrate and define what we
need to do, where and based on what standards, how we should do it, and
how well we should do it. DHS developed three documents to address
these needs. The National Response Plan was designed to identify what
needs to be done, the National Incident Management System describes how
to manage what needs to be done in response to an emergency incident,
and the National Preparedness Goal is designed to define how well we
should do what needs to be done. Hurricane Katrina was the first major
test of the NRP.
These three documents, considered as a group, can be one basis for risk
analyses to assess the most productive and urgent investments in
emergency preparedness and response capabilities. The National
Preparedness Goal, whose development was required by Homeland Security
Presidential Directive 8 (HSPD-8), is particularly important. DHS
issued an interim version of the goal in March 2005 and an expanded
draft in December 2005. The December 2005 draft National Preparedness
Goal defines both the 37 major capabilities that first responders
should possess to prevent, respond, and recover from a wide range of
major emergency incidents and the most critical tasks associated with
these capabilities. These critical tasks are appropriately considered
in risk analysis. An inability to effectively perform these tasks
would, by definition, have a detrimental impact on effective
prevention, response, and recovery capabilities.
To identify the needed capabilities, DHS used 15 National Planning
Scenarios developed by the President's Homeland Security Council that
included 12 terrorist attacks and 3 natural disasters--an earthquake, a
hurricane, and a pandemic influenza outbreak. According to DHS, the
planning scenarios are intended to illustrate the scope and magnitude
of large-scale, catastrophic emergency events for which the nation
needs to be prepared. Because no single jurisdiction or agency would be
expected to perform every preparedness task or have every capability to
the same degree, possession of critical capabilities could involve
enhancing and maintaining local resources, ensuring access to regional
and federal resources, or some combination of the two. Risk factors
include population and population density, the presence of critical
infrastructure and key resources, and location in high terrorist threat
or high risk natural disaster areas. The National Preparedness Goal
includes seven national priorities, including implementing the NIMS and
NRP and expanding regional collaboration. Those seven priorities are
incorporated into DHS's fiscal year 2006 homeland security grant
guidance. The guidance also adds an eighth priority that emphasizes
emergency operations and catastrophic planning.
In earlier work on the National Preparedness Goal, we observed that if
properly planned and executed, the goal and its related products, such
as program implementation plans and requirements, may help guide the
development of realistic budget and resource plans for an all-hazards
national preparedness program.[Footnote 12] However, questions remain
regarding what should be expected in terms of basic capabilities for
most disasters compared to the expanded capabilities and mutual aid
needed from other jurisdictions to meet the demands of a catastrophic
disaster.
HSPD-8 called for strengthening preparedness capabilities of federal,
state, and local entities. However, guidance on implementing the
National Preparedness Goal appears to have been targeted at state and
urban area jurisdictions. It does not appear that similar attention has
been paid to guidance for federal agencies and their progress in
supporting the National Preparedness Goal's expectations. Consequently,
we recommend that DHS should take the lead in strengthening guidance
for federal agencies and monitoring their efforts to meet the National
Preparedness Goal's provisions for federal agencies.
Our recommendation is consistent with those of the White House. The
White House has recommended that future preparedness of the federal,
state, and local authorities should be based on the risk, capabilities,
and needs structure of the National Preparedness Goal. More
specifically, the White House recommends that the National Preparedness
Goal and its target capabilities list should be used, for example, in
(1) defining required capabilities and what levels of those
capabilities are needed, including those within the purview of the
federal government, (2) developing mutual aid agreements and compacts
informed by the National Preparedness Goal's requirements, and (3)
developing strategies to meet required levels of capabilities that
prioritize investments on the basis of risk. We have work underway to
assess if the provisions of the National Preparedness Goal will aid
catastrophic disaster preparedness and NRP implementation.
A Focus on Assessing Planning and Capabilities Will Be Critical:
In our work on the National Preparedness Goal, we also observed that
DHS's assessment and reporting implementation plan, intended to
accurately identify the status of capabilities at the state, regional,
and local levels, is vital for establishing a baseline and providing an
ongoing feedback loop upon which decisions at multiple levels of
government about preparedness needs will rest. Assessment of
catastrophic disaster planning and capability needs will be a critical
piece.
In the conference report to the Department of Homeland Security Fiscal
Year 2006 Appropriations Act, the conferees directed DHS to report on
the status of catastrophic planning, including mass evacuation planning
in all 50 states and the 75 largest urban areas.[Footnote 13] In
addition, the Safe, Accountable, Flexible, Efficient Transportation
Equity Act: A Legacy for Users required the Secretary of Transportation
and the Secretary of Homeland Security to jointly review and assess
federal and state evacuation plans for catastrophic hurricanes
impacting the Gulf Coast Region.[Footnote 14]
In response, DHS launched a nationwide review of state, territorial,
and urban area emergency and evacuation plans. In the first phase of
the review, each state and territory and urban area was to certify the
status of its emergency operations plans and identify when plans were
last updated and exercised. According to the DHS report on the first
phase's results, 56 states and territories and 72 urban areas
responded. Fewer than half of those reporting might have adequate
planning for a catastrophic disaster. Of those jurisdictions reporting
that their base plan was consistent with federal guidance and voluntary
standards, 42 percent of the states and territories and 36 percent of
urban areas were confident that their plan was adequate to manage a
catastrophe.[Footnote 15] In a second phase of the review, peer review
teams are to validate the self-assessments, determine requirements for
planning assistance, collect best practices, and recommend corrective
actions. DHS plans to complete these peer reviews by the end of April
2006 and report to the President and Congress before June 1, 2006. The
White House has recommended DHS establish a program to measure and
assess the effectiveness of preparedness capabilities on an annual
basis and recommend appropriate adjustments to the National
Preparedness Goal, capabilities, and yearly priorities for homeland
security grants. We are currently examining evacuation planning and
assistance, including the federal role in the emergency evacuation of
transportation-disadvantaged populations--including the elderly,
disabled, and low income individuals--and preparedness for the
evacuation of hospitals and nursing homes.
Similar to DHS's overall national preparedness planning, no single
state or area should be expected to have the same capability to prepare
for a catastrophic disaster. The stand-up and sustaining of
capabilities should be based on a risk assessment that would call for
examining what vulnerabilities from a potential catastrophic disaster
require attention and how they should be addressed within available
resources and with contingency planning. Periodic assessments should
determine if plans remain viable, actual capabilities match planned
capabilities, and if contingency planning still is appropriate.
I would suggest that before the Congress and the Administration embark
on implementing the more expensive aspects of preparing for a
catastrophic disaster, policymakers should discuss in a timely fashion
and reach consensus on the following issues:
* What is known about the likelihood of a catastrophic disaster
occurrence in specific areas of the nation? For example, what are the
odds that more category 4 and 5 hurricanes will strike specific areas
of the Gulf and East Coasts? How likely is it that California or other
earthquake-prone areas will experience "the big one?" What are the
chances that a nuclear plant will suffer an incident that results in
massive radiation exposure?
* How vulnerable are the areas that would be affected by these
catastrophic disasters and what would be the consequences, in terms of
human life, economic impact, and other generally accepted measures?
* What are the costs and potential benefits of actions governments can
take to mitigate the occurrence and consequences of these disasters?
For example, in the case of catastrophic hurricanes, what are the costs
and benefits of greater and more precise early warnings, better
resourced and exercised evacuation plans, more pre-positioned equipment
such as generators and water, more designated shelters and medical care
resources, enhanced health care operations, and better mutual aid
planning and specific agreements?
* Finally, based on all of the above, what are the most prudent courses
of action for various levels of government and their partners, such as
private industry and nongovernmental organizations, in preparing for
and responding to catastrophic disasters?
These are not easily answered questions. However, given the enormous
potential costs and the increasing demands on federal discretionary
funding, these are some of the questions that policymakers should
explicitly discuss, reach consensus, and periodically reassess as
events and considerations change. If federal funds will be used to
increase first responders' capabilities for catastrophic disasters, we
suggest that the Congress require the use of risk management principles
to assess state and urban area investments in capabilities to respond
to a catastrophic disaster.
Organizational Placement Has Been Raised as a Key FEMA Performance
Factor:
Because of FEMA's mission performance during Hurricane Katrina,
concerns have been raised regarding the agency's organizational
placement, including whether it should be disbanded and functions moved
to other agencies, remain within the Department of Homeland Security,
or again become an independent agency. Importantly, other factors, such
as the experience of and training provided to FEMA leadership and
adequacy of resources may be more important to FEMA's future success
than its organizational placement.
Factors Other Than Organizational Placement May Impact FEMA's
Performance:
Organizational changes, such as separating FEMA from DHS, are often
viewed as a quick fix to address performance issues. Based on our
institutional knowledge regarding organizational performance factors,
organizational changes alone may not adequately address underlying
systemic conditions that result in an organization's performance
problem. Conditions underlying FEMA's performance during Hurricane
Katrina could involve the experience and training of DHS or FEMA
leadership; the clarity of FEMA's mission and related responsibilities
and authorities to achieve mission performance expectations; the
adequacy of its human, financial, and technological resources; and the
effectiveness of planning, exercises, and related partnerships.
These factors have been highlighted, for example, by, the House Select
Committee which noted (1) senior officials were ill prepared due to
their lack of experience and knowledge of the required roles and
responsibilities prescribed by the NRP, (2) DHS and FEMA lacked
adequately trained and experienced staff for the Katrina response,
observing that FEMA had lost, since 2002, a number of its top disaster
specialists, senior leaders, and experienced personnel, described as
"FEMA brain drain," and that even before Hurricane Katrina, FEMA
suffered from a lack of sufficiently trained procurement professionals,
and (3) FEMA's logistics systems were unable to support large-scale
logistical challenges. In addition, White House recommendations covered
areas such as DHS expertise and experience, development of a national
crisis communications system, and development of DHS regions that are
fully staffed, trained, and equipped to manage and coordinate all
preparedness activities and any emergency that may require a
substantial federal response.
Factors such as the experience and training of leadership and the
adequacy of resources can lead to performance difficulties pointed out
in the House Select Committee, the White House report, and in testimony
before this committee. These difficulties would not, we believe, be
fixed by simply moving FEMA to an independent status. Indeed, we know
that many of lessons learned from Hurricane Katrina were acted on for
Hurricane Rita, with a much better response effort, indicating that
organizational change is not the primary key to success. Such factors,
we believe, should be more carefully assessed and action taken where
appropriate to strengthen any weaknesses in FEMA's leadership and
resources.
Certain Criteria Could Be Used if a Change in FEMA's Organizational
Placement is Considered:
However, if an organizational change remains under consideration, our
past work could be helpful. Before the formation of DHS, I testified
before the House Select Committee on Homeland Security that
reorganizations of government agencies frequently encounter start-up
problems and unanticipated consequences and are unlikely to fully
overcome obstacles and challenges, and may require additional
modifications in the future.[Footnote 16] I also presented specific
criteria to evaluate whether individual agencies or programs should be
included or excluded from the proposed department. Those criteria
included, for example, mission relevancy, similar goals and objectives,
leveraging the effectiveness of other agencies and programs or the new
department as a whole, and gains in efficiency and effectiveness
through eliminating duplications and overlaps. I also stated that
Congress should consider not only the mission and roles that agencies
fulfill today, but the mission and role that they should fulfill in the
coming years.
Some of these criteria are appropriate today for discussing FEMA's
future, and I would suggest that they might be useful if a change in
FEMA's organizational placement is under consideration. For example,
Congress might consider whether or how moving FEMA out of DHS would
impact DHS's mission, as stated in the Homeland Security Act of 2002,
of acting as a focal point for natural and manmade crises and emergency
planning. DHS's Emergency Preparedness and Response Directorate--
primarily FEMA--was to help ensure the effectiveness of emergency
response providers to terrorist attacks, major disasters, and other
emergencies. Removing FEMA from DHS might impact the ability of the
department and its remaining components and FEMA itself in fully
addressing the close links between preparedness, prevention, response,
and recovery for all hazards.
The dispersion of responsibility for all hazards preparedness and
response across more than one federal agency was a problem we
identified during the formation of DHS.[Footnote 17] FEMA was
established in 1979 to consolidate federal emergency preparedness
mitigation, and response in a single federal agency. Its
responsibilities were to include, among other things, the coordination
of civil defense and civil emergency planning and the coordination of
federal disaster relief. FEMA responded to a wide range of disasters,
including floods, hurricanes, earthquakes, hazardous material
accidents, nuclear accidents, and biological, chemical, and nuclear
attacks.[Footnote 18] However, when Congress created DHS, it separated
FEMA's responsibilities for preparedness and response activities into
two directorates. Responsibility for preparedness for terrorism
disasters was placed in the department's Border and Transportation
Security Directorate, which included FEMA's Office of National
Preparedness. Other types of FEMA disaster preparedness and response
efforts were transferred to the department's Emergency Preparedness and
Response Directorate. In January 2003, we observed that this
organizational arrangement would challenge FEMA in ensuring the
effective coordination of preparedness and response efforts and
enhancing the provision and management of disaster assistance for
efficient and effective response.[Footnote 19]
A division of responsibility remains under the recent DHS
reorganization resulting from Secretary Chertoff's Second Stage Review
(2SR), with preparedness efforts--including planning, training,
exercising, and funding--consolidated into a Preparedness Directorate.
FEMA reports directly to the Secretary of Homeland Security for
response and recovery missions. Secretary Chertoff has explained the
reorganization would focus FEMA on its historic mission of response and
recovery.
If FEMA were to become independent of DHS, then a comprehensive
approach to preparedness, response, and recovery may become even more
difficult to maintain. The lack of a single department or agency with
responsibility for preparedness, response, and recovery also could
jeopardize clear federal leadership and assistance for state and local
governments. These entities would have two primary points of contact,
two points of guidance and regulation, two points of funding
opportunities, and two points of assistance and oversight.
Nongovernmental and private sector partners in all hazards preparedness
would be similarly affected.
Other organizational changes are also being considered. The White House
report on lessons learned from Hurricane Katrina recommended keeping
FEMA within DHS, but allows for other organizational changes, such as
creating new positions and offices within DHS and transferring the
National Disaster Medical System from DHS to the Department of Health
and Human Services.
Lastly, I believe we should bear in mind that the Department of
Homeland Security is only three years old this month. In my testimony
on the formation of DHS in 2002, I stated that often it has taken many
years for the consolidated functions in new departments to effectively
build on their combined strengths.
Long Term Rebuilding Efforts Raise Issues for Congressional
Consideration:
Madame Chairman, the federal government will be a major partner in the
longer-term rebuilding of the Gulf Coast because of the widespread
damage and economic impact. In support of state and local efforts, the
federal role in rebuilding will be particularly important for
transportation and health infrastructures and federal facilities. In
addition, federal programs will face financial difficulties and there
is uncertainty concerning the impact of catastrophic disasters on the
availability and affordability of insurance. Long term rebuilding
raises issues concerning the need for consensus on what rebuilding
should be done, where and based on what standards, who will pay for
what, and what oversight is needed to ensure federal funds are spent
for their intended purposes.
The Hurricanes' Destruction Resulted in Widespread Adverse Economic
Disruptions:
Hurricane Katrina destroyed considerable numbers of residential
structures; consumer durable goods, such as motor vehicles, household
furnishings, and appliances; and business structures and equipment,
particularly in the energy and petrochemical industries. Hurricane Rita
appears to have had a smaller impact on residential structures and
consumer durable goods, and its damage to the energy industry may be as
great as or greater than Hurricane Katrina's.
Some federal agencies have developed programs to initially identify and
assess the recovery needs of the region. For example, the U.S.
Environmental Protection Agency (EPA) and the Centers for Disease
Control and Prevention (CDC), created the Environmental Health Needs
Assessment and Habitability Taskforce. This taskforce was charged with
identifying the overarching environmental health issues faced by New
Orleans to re-inhabit the city. According to the taskforce, the most
striking feature of the Hurricane Katrina catastrophic disaster in New
Orleans is the array of key environmental health and infrastructure
factors affected all at once. All key environmental health and related
services are being reestablished, and this work needs to be done in a
very coordinated and well-planned way. Full restoration of drinking
water systems and wastewater treatment systems will be delayed by the
many disruptions in the distribution and collection systems and by the
need for upgrade and repairs in older systems. The task force also
noted timeline for debris treatment, disposal, containment, and
transport, as well as for the testing of potentially contaminated soil,
will also slow or accelerate the rate at which New Orleans can be re-
inhabited.
The task force found that restoration of the city's housing
infrastructure is its most complex issue. Housing is likely the most
critical issue in re-inhabiting the city because of factors such as the
large percentage of city housing that was flooded and may not be
viable, as well as the large proportion of the city population that is
displaced with some residents a significant distance away from New
Orleans or not intending to return, according to the task force. EPA
and other federal partners are continuing to assess and address
environmental and health issues that will impact the recovery and
rebuilding of the Gulf Coast.
The ongoing progress of recovery and rebuilding is being studied by
several organizations. For example, the Brookings Institute created an
index of economic and social indicators measuring the impact of
rebuilding efforts in Orleans Parish, the New Orleans metropolitan
area, Louisiana, and Mississippi. Brookings' February 1, 2006 report
noted that over five months since Hurricane Katrina made landfall, New
Orleans lacks enough essential services to support all of its returning
residents and the area continues to lose workers. More specifically,
the report observed that only 32 percent of the city's hospitals are
open. Only 15 percent of the city's schools have reopened and some of
those are reporting difficulty accommodating demand. Nearly 750,000
households remain displaced. Mortgage delinquency rates rose between
the second and third quarters of 2005. In the state of Louisiana,
nearly 1 in 4 mortgages is 30 days or more past due. Currently, the New
Orleans metro area lost 42,000 people in its labor force between
November and December, while the state of Louisiana lost over 100,000
people. Although the state of Louisiana created over 11,000 jobs
between November and December, it lost over 100,000 people in its labor
force. Mississippi lost 2,000 jobs and about 2,000 of its labor force.
According to the Brookings' analysis, the slow pace of recovery
strongly suggests that the city and state will be unable to restore
essential services on their own, and require direct federal assistance
to do so.
Rebuilding Strategies Are Underway:
In Louisiana and Mississippi, several efforts are underway to develop
long-term rebuilding strategies in these states. In Louisiana, the
governor and the mayor of New Orleans have charged different groups
with guiding various aspects of the rebuilding efforts. Under the
mayor, the Bring New Orleans Back Commission is intended to help New
Orleans develop a "Master Plan" to include recommendations for
rebuilding the city. The commission has issued several final reports,
including those on urban planning, education, health and social
services, and infrastructure. At the state level, the Louisiana
Recovery Authority is the planning and coordinating body created by the
Governor to assist in implementing the state's vision for the recovery
of Louisiana. Working in collaboration with local, state and federal
agencies, the authority serves to address short-term recovery needs and
guide the long-term planning process.
In Mississippi, the Governor's Commission on Recovery, Rebuilding and
Renewal was formed to develop a strategy for rebuilding the affected
areas of Mississippi. Developed as an advisory body, the commission is
intended to solicit the input of local leaders and facilitate decision
making in their regions. In early January the commission released a
report with numerous recommendations intended to guide Mississippi's
post-Katrina rebuilding. The report recommends, for example, that local
governments immediately adopt revised flood maps and begin assessing
and revising their flood zone management ordinances and building
requirements. In addition, the report suggests ways communities can tap
into federal, state, and private funding sources to accomplish some of
the report's goals.
On November 1, 2005, the President issued Executive Order 13390, which
directed the creation of a central figure in the administration's
efforts to support the Gulf Coast recovery and rebuilding
phases.[Footnote 20] Specifically, the President directed the Secretary
of Homeland Security to establish within the department the position of
Coordinator of Federal Support for the Recovery and Rebuilding of the
Gulf Coast region. The federal coordinator, Donald Powell, is
responsible for developing principles and goals and leading the
development and monitoring of the implementation of specific federal
support. The coordinator also serves as the focal point for managing
information flow, requests for actions, and discussions with the
Congress, state and local governments, the private sector, and
community leaders.
Madame Chairman, we need to make sure that rebuilding in the Gulf Coast
should not replace that which was built in the past to 20TH century
standards, but be built for the future and to 21ST century standards.
State and local officials will have the lead on determining the future
needs of the Gulf Coast. However, the federal government should be a
willing partner in the rebuilding strategies so we build better than
before and in anticipation of future catastrophic events.
Now, I would like to turn to more specifically discuss rebuilding
transportation and health infrastructures and federal facilities.
Transportation Infrastructure Was Significantly Damaged and Poses Major
Cost and Funding Concerns:
Transportation infrastructure destruction will have a considerable
impact on federal programs. The hurricanes destroyed significant
amounts of the region's transportation infrastructure. The largest
transportation capital costs will be associated with reconstruction of
highways and bridges--Hurricanes Katrina, Rita, and Wilma resulted in
about $2.7 billion in needed repairs to roads on the federal-aid
highway system. Hurricane Katrina resulted in the bulk of this cost,
with about $2.1 billion in highway damage. Louisiana, Mississippi, and
Florida suffered the vast majority of the highway damage. Federal
Highway Administration (FHWA) officials said that because many roads
have been submerged, determination of the full extent of highway damage
will depend on the results of testing.
FHWA works with the states to develop these estimates, and funding for
repair and reconstruction comes through FHWA's Emergency Relief
Program. Under this program, states are reimbursed the cost of repairs
and reconstruction of the existing highway facilities, and improvements
are generally not allowed. However, bringing a facility up to current
highway design standards is allowed. Only roads on the federal-aid
highway system are eligible for funding. A large backlog of funding
requests to this program existed prior to the hurricanes, about $650
million pre-Katrina, resulting in a total state demand for emergency
funds of about $2.85 billion. In its fiscal year 2006 Defense
Appropriations Act, Congress appropriated $2.75 billion to the FHWA
Emergency Relief Program. These funds are available for both the 2005
hurricanes and other emergency projects. We plan to review the FHWA
Emergency Relief Program and related surface transportation financing
issues that have arisen as a result of the hurricanes.
Transit systems in the region sustained considerable damage, especially
in New Orleans, where most of the transit fleet was lost. This included
three bus garages, an operations and maintenance facility, much of the
trolley system, and a majority of the city's bus fleet. In addition,
the population of Baton Rouge roughly doubled in a matter of days,
which presented an unprecedented transit problem for that city. While
no transit program comparable to the FHWA Emergency Relief Program
exists, FEMA provided $47 million under a mission assignment to help
provide basic transit services within and between Baton Rouge and New
Orleans.
Ports in the region also suffered significant damage. The Port of New
Orleans estimated reconstruction and relocation needs of $435 million
to cover damages sustained from Hurricane Katrina, assuming $75 million
would be funded by insurance claims or FEMA reimbursements. The
remaining $360 million is unfunded. The Port of Gulfport was also hard
hit, and while it is still developing estimates, according to the port
director, reconstruction will likely total between $300 million and
$400 million. Part of these costs will be covered by insurance and
revenues from resumed port operations. According to officials from
other ports in the region, they also sustained damage, though not of
this magnitude. For example, the Port of Mobile sustained $28 million
in damages, while other Louisiana ports, such as Port Fourchon and the
Port of South Louisiana, estimate damages of $7 million and $2 million
respectively. We have initiated a review of how ports mitigate their
vulnerability to natural disasters, what lessons have been learned, and
what the potential federal role may be in mitigating port
vulnerability.
A number of railroads suffered damage from Hurricane Katrina. The large
railroads have nearly completed repairs to their systems, while a
number of smaller short lines are in the process of repairing lines.
These costs are currently borne by the railroads themselves, and the
Department of Transportation does not have estimates of the damages.
However, a financial statement from the CSX railroad estimated damages
from Hurricane Katrina to that railroad's assets at over $40 million.
Numerous airports in the region were affected by the hurricanes. The
Federal Aviation Administration (FAA) estimates that about $100 million
will be needed from the Airport Improvement Program to pay for damage.
In addition, FAA estimated that its facilities sustained about $41
million in damage, for a total of $141 million.
Health Care Infrastructure Was Significantly Damaged:
The health care infrastructure in the New Orleans area, including
emergency, hospital and clinic facilities, was significantly damaged by
Hurricane Katrina. The city is struggling to restore some capacity to
meet the immediate needs of the population currently there. Moreover,
numerous decisions that will need to be made on how to rebuild the
health care system. The decisions are complicated by several factors,
including the need to improve efficiency by moving away from New
Orleans hospital-centric system and uncertainty about how many people
will return to New Orleans and where they will settle.
The damage inflicted by Hurricane Katrina on the New Orleans health
system was severe. In particular, the Medical Center of Louisiana at
New Orleans (MCLNO), which included Charity and University Hospitals,
was forced to close its doors. MCLNO operated the only Level I trauma
unit along the Gulf Coast. With its closure, the closest Level I trauma
units are in Shreveport, Louisiana, Houston, Texas, and Birmingham,
Alabama.[Footnote 21] In addition, MCLNO provided more than 25,000
inpatient admissions, over 300,000 clinic visits and 135,000 emergency
visits in fiscal year 2004. It was the primary safety net hospital for
many local residents, and about half of its patients were uninsured and
about one-third were covered by Medicaid. Under the Stafford Act,
Charity Hospital is eligible for federal funds to repair Hurricane
Katrina related damage. These funds, administered under FEMA's Public
Assistance Program, would be available to defray a portion of the cost
to rebuild or repair Charity Hospital. FEMA and Louisiana State
University, which owns Charity Hospital, have prepared estimates of the
cost to repair the hospital that differ considerably in their
assumptions and conclusions, and no decision has been made as to
whether to rebuild or repair the facility.
Other health services in New Orleans were also severely damaged,
including hospitals, emergency services, and safety net clinics.
Hospitals: The number of staffed hospital beds in the City of New
Orleans was about 80 percent less in February 2006 than before
Hurricane Katrina, according to figures submitted daily by hospitals to
an internet database about their bed capacity.[Footnote 22] Of the nine
acute care hospitals in the city prior to Katrina, only 3 had re-opened
at a capacity of approximately 456 staffed beds as of February 22,
2006.
Emergency Care: Increasing demand has been reported at the open
emergency departments and has led to slow unloading of patients from
ambulances and to patients being housed in the emergency department
because beds were not available. For example, according to data
reported by hospitals on February 22, 2006, wait times for emergency
medical services (EMS) vehicles to offload stable patients into
emergency departments varied from no wait to as long as 2 hours at two
facilities, and 38 patients had been admitted and were housed in the
emergency department.
Safety Net Clinics: More than three-fourths of the safety net clinics
in the New Orleans area were closed, and many of those that were open
had limited capacity, according to data gathered by officials at the
Louisiana Department of Health and Hospitals (DHH). For example, prior
to Katrina, 90 clinics were in operation, including 70 various clinics
run by MCLNO, with the remainder federally qualified health centers,
mental health or addictive disorder clinics, or other specialty
clinics. Post-hurricane, 19 clinics were operating according to DHH
figures, generally operating at less than 50 percent of pre-Katrina
capacity.
In addition to the severe damage sustained by health facilities,
maintaining and attracting the workforce is also a serious issue for
local officials. An estimated 3,200 physicians lived in the
metropolitan area before Hurricane Katrina, with 2,664 of those
physicians residing in New Orleans itself, according to DHH figures. We
were unable to obtain an estimate of how many physicians are currently
in New Orleans. Hospital officials said they faced a shortage of
support staff, such as food service or janitorial workers, who were
unable to return due to a lack of housing or were being offered higher
wages at hotels and restaurants.
As the city struggles to restore the health system in New Orleans, long-
term decisions on how to rebuild it are affected by questions about
whether the health system should be rebuilt to its pre-Katrina
configuration and uncertainties about the returning population. Some
health policy researchers have noted that the pre-Katrina health system
in New Orleans needed improvement. Some local officials have also
suggested that the health care situation prior to the hurricane was
less than ideal and the city has a chance to rebuild a better system.
Also, uncertainty about how quickly the population would return to New
Orleans, as well as who would return and where people will settle,
poses difficult challenges for local officials to plan the restoration
of health services, such as how much capacity will be required and
where to locate services.
Over the long term, building a new health care system will be vital to
attract people back to New Orleans and ensure its recovery. State,
local and federal governments all have important roles to play in the
recovery process. At the state and local levels, commissions to plan
for the future health care system have been established, and one has
completed its work. The Bring New Orleans Back Commission issued
recommendations shifting the focus, to the degree possible, toward
ambulatory care, wellness and preventive medicine, health promotion and
chronic disease prevention and away from institutional care;
maintaining a university teaching hospital in New Orleans; and building
capacity for electronic medical records. The commission also noted the
difficulty of doing effective planning without reliable information on
the population and what segments of the population will return. The
Louisiana Recovery Authority included one task force dedicated to
health care issues. The NRP also gives the Department of Health and
Human Services a support role under long-term community recovery and
mitigation to enable community recovery from the long-term consequences
of a large-scale incident. We will be following HHS' efforts to fulfill
this role in the coming months.
Federal Facilities Were Damaged or Destroyed:
Several federal agencies had their facilities damaged or destroyed by
the hurricanes and may face significant costs to repair or replace
them, although these costs are relatively small in relation to those I
just discussed. The Department of Veterans Affairs (VA) estimated
damage to its medical centers in New Orleans and Biloxi at $170 million
and $50.7 million respectively. VA's Gulfport hospital complex suffered
catastrophic damage and will not be rebuilt since VA had already
planned to close it. The National Aeronautics and Space Administration
estimated the cost of facility repair at the Stennis Space Center in
Mississippi and Michoud Assembly Facility in New Orleans at $84 million
and $69 million respectively. The General Services Administration
estimated the cost of repairing its owned and leased facilities and
leasing alternative space at $60 million. The U.S. Postal Service
estimated the cost of facility repair from Hurricane Katrina at $57
million. The Department of Interior estimated damage to facilities,
which includes damages to buildings, phone systems, electrical systems,
and information technology systems among other things, at about $41
million. In addition, there was damage to military bases and to
shipyard repair facilities.
Federal Flood Insurance Program Faces Record Claims and Financial
Difficulties:
The federal flood insurance program faces major financial difficulties
challenges as the Gulf Coast recovers. The program is essentially
bankrupt. FEMA officials estimate that Hurricanes Katrina and Rita will
result in flood insurance claims of about $23 billion, far surpassing
the total amount of claims paid in the entire history of the National
Flood Insurance Program (NFIP) through 2004.
These storms have presented, among other challenges for the NFIP, the
need to adjust a record number of claims, many for properties that were
inaccessible for weeks after the flooding occurred, and the need to
borrow funds from the U.S. Treasury to pay the settlements due to
policyholders. Almost 87,000 loss claims totaling over $8 billion were
paid for Hurricane Katrina claims in Alabama, Florida, Mississippi, and
Louisiana through November 30, 2005. By comparison, in 2004, the
previous record year, the NFIP paid about $1.95 billion in claims on
flood events, including Hurricanes Charley, Frances, Ivan, and Jeanne
that caused major damage in Florida and other East Coast and Gulf Coast
states. Though numbers are not finalized, a FEMA official said that by
the end of December, 2005, more than 70 percent of claims for
Hurricanes Katrina, Rita, and Wilma had been paid totaling more than
$11 billion.
The amount paid per claim for flood damage in Hurricane Katrina ranged
from a high of $130,281 in Mississippi to a low of $17,727 per claim in
Florida. In Louisiana, where more than three fourths of the claims were
filed, the average amount paid per claim was $92,549. A FEMA official
noted that claims for total losses were paid quickly, so the average
amount paid per claim may be less when all claims are settled. The
average amount paid per claim for damage from Hurricane Rita was
$52,185 in Louisiana and $24,489 in Texas.
The magnitude and severity of the flood losses from Hurricanes Katrina
and Rita overwhelmed the ability of the NFIP to absorb the costs of
paying claims, providing an illustration of the extent to which the
federal government is exposed to claims coverage in catastrophic loss
years. As of March 1, 2006, FEMA's authority to borrow from the U.S.
Treasury was increased from $1.5 billion prior to the 2004 hurricane
season to $18.5 billion through fiscal year 2008. While no
determinations have been made about whether the NFIP will repay any of
the debt, it is unlikely that the program could generate sufficient
revenues to cover the enormous losses.
Until the 2004 hurricane season, FEMA had exercised its borrowing
authority three times in the last decade when losses exceeded available
fund balances. In each instance, FEMA repaid the funds with interest.
According to FEMA officials, as of August 31, 2005, FEMA had
outstanding borrowing of $225 million with cash on hand totaling $289
million. FEMA had substantially repaid the borrowing it had undertaken
to pay losses incurred for the 2004 hurricane season that, until
Hurricane Katrina struck, was the worst hurricane season on record for
the NFIP. FEMA's current debt with the U.S. Treasury is almost entirely
for payment from flood events that occurred in 2005. We currently have
work underway examining the challenges facing the NFIP and options for
improving the program.
Flood maps are the foundation of the NFIP. They identify the areas at
risk of flooding, and accurate, updated flood maps are a critical
component for devastated communities in Mississippi and Louisiana, in
particular, for making decisions about where and how to rebuild. Thus,
new maps for these areas need to be expedited and completed as soon as
possible.
As of January 2006, FEMA had not yet fully implemented provisions of
the Flood Insurance Reform Act of 2004, including establishing a
regulatory appeals process for claimants and establishing minimum
education and training requirements for insurance agents who sell NFIP
policies. These reforms should also be completed expeditiously, and we
have recommended that FEMA develop documented plans with milestones for
implementing the reforms required by the 2004 legislation.
The Small Business Administration's Disaster Loan Program Also Faces
Financial Concerns:
We have initiated work to identify and assess the factors that have
affected the Small Business Administration's (SBA) ability to respond
to disaster victims through its disaster loan program in a timely
manner. As the primary federal lender to disaster victims, including
individual homeowners, renters, and businesses, SBA's ability to
process and disburse loans in a timely manner is critical to the
recovery of the Gulf Coast region. As of February 25, 2006, SBA had
mailed out more than 1.6 million loan applications, received over
337,800 completed applications, processed more than 230,900
applications, and disbursed about $426.8 million in disaster loan
funds. Although SBA's current goal is to process loan applications
within seven to 21 days, as of February 25, 2006, SBA faced a backlog
of about 103,300 applications in loan processing pending a final
decision, and the average age of these applications is about 94 days.
At the average rate SBA processed loans during the past month, it will
take the agency 51 days to process its current backlog. However, this
figure will be further affected by the number of new loan applications
that are being received daily. SBA also faces a backlog of more than
37,100 loan applications that have been approved but have not been
closed or fully disbursed. As a result, disaster victims in the Gulf
Region have not been receiving timely assistance in recovering from
this disaster and rebuilding their lives.
Based on our preliminary analysis of SBA's disaster loan origination
process, we have identified several factors that have affected SBA's
ability to provide a timely response to Gulf Coast disaster victims.
First, the volume of loan applications SBA mailed out and received has
far exceeded any previous disaster. Compared with the Florida
hurricanes of 2004 or the 1994 Northridge earthquake, the hurricanes
that hit the Gulf Coast in 2005 resulted in roughly 2 to 3 times as
many loan applications issued.[Footnote 23] Second, although SBA's new
disaster loan processing system provides opportunities to streamline
the loan origination process, it has experienced numerous outages and
slow response times in accessing information. However, we have not yet
determined the duration and impact of these outages on processing. SBA
officials have attributed many of these problems to a combination of
hardware and telecommunications capacity limitations as well as the
level of service SBA has received from its contractors. Third, SBA's
planning efforts to address a disaster of this magnitude appear to have
been inadequate. Although SBA's disaster planning efforts focused
primarily on responding to a disaster the size of the Northridge
earthquake, SBA officials said that it initially lacked the critical
resources such as office space, staff, phones, computers, and other
resources to process loans for this disaster. SBA has participated in
disaster simulations only on a limited basis and it is unclear whether
previous disaster simulations of category 4 hurricanes hitting the New
Orleans area were considered.
We are also assessing other factors that have affected SBA's ability to
provide timely loans to the disaster victims in the Gulf region
including workforce transformation, exercising its regulatory authority
to streamline program requirements and delivery to meet the needs of
disaster victims, coordination with state and local government
agencies, SBA's efforts to publicize the benefits offered by the
disaster loan program, and the limits that exist on the use of disaster
loan funds.
Uncertainty About Catastrophic Disasters Affects the Availability and
Affordability of Insurance:
The magnitude and severity of Hurricane Katrina and other recent
catastrophes also impacted the insurance industry's willingness and
ability to provide insurance protection for catastrophic disasters. A
crucial aspect of being able to successfully provide such coverage is
the ability to obtain what the industry refers to as credible
"vulnerability assessments" or risk assessments. To be useful, a risk
assessment must be able to estimate both the likely "frequency" and
"severity" of catastrophic events--two key characteristics that
insurance companies need to assess the probability and financial
significance of a loss. In addition, based on credible information,
insurers must be able to estimate both their "probable maximum loss
(PML)," an estimate of the maximum dollar value that can be lost under
realistic conditions, and their "maximum foreseeable loss (MFL)," an
estimate of the maximum dollar loss under a worst-case scenario. Risk
assessments can be used to provide a basis for making loss projections
for catastrophes such as hurricanes or earthquakes, although the
projections may not be accurate. Insurance companies use these
estimates to determine the amount of coverage and the price at which to
offer coverage within a geographic area. Potential losses are
acceptable if the probability that they may occur is understood and
companies can set prices that fully reflect the consequences of a
specific risk. When projections fail to anticipate an event, such as an
earthquake, or underestimate the severity of an event, such as
Hurricane Katrina, insurance companies may become insolvent, as
happened in the aftermath of Hurricane Andrew, or may choose to reduce
the amount of coverage offered in a given area, as happened for wind
losses in Florida and for earthquakes in California.
While the practice of risk assessment has become more sophisticated in
recent years, the ability of such assessments to estimate losses
remains inexact, particularly for many potential catastrophes. These
assessments are typically undertaken by risk modeling companies that
assist clients, such as insurance companies, with predicting and
managing the financial impact of catastrophes and weather. In addition,
as demonstrated by Hurricane Katrina, estimating the amount of losses
that insurers could pay for an event is also contingent on unforeseen
circumstances, such as the unusual magnitude and consequences of the
Hurricane Katrina storm surge. In addition, as a result of Hurricane
Katrina, hundreds of thousands of buildings may have suffered damage
from both the hurricane's winds and the storm surge. Because
determining which factor caused the damage to a given structure is
difficult and sometimes contentious, estimates of the amount that
private insurers ultimately will pay to cover the costs of Hurricane
Katrina are still very preliminary.
Because catastrophic disasters are likely to occur in the future, and
because forecasting their probability and severity is an inexact
science, state insurance regulators have recommended that the federal
government provide a final layer of insurance protection in the event
of a "mega-catastrophe." The National Association of Insurance
Commissioners (NAIC) is considering a broad national plan that would
create a mechanism to handle disasters, especially those larger than
Hurricane Katrina. The plan proposes a public-private partnership that
would reward hazard mitigation and spread catastrophic risk broadly
among individual insureds, insurers, reinsurers, state reinsurance
funds, and the federal government, according to NAIC. The federal
government could provide a top layer of protection by acting as a
reinsurer of last resort or, alternatively, by providing financial
capacity to a multi-state risk pooling mechanism that could borrow from
the federal government should catastrophic losses exceed the pool's
accumulated funds. This plan is similar in scope to the Terrorism Risk
Insurance Act (TRIA), which Congress enacted to create a program of
shared public and private compensation for insured losses attributable
to acts of terrorism. Under the NAIC plan, however, taxpayers would
presumably not have to pay for losses. Furthermore, the NAIC plan
asserts that if state and federal governments insured the top layers of
catastrophe risk, private insurers would continue to insure the initial
layer of risk that they might otherwise not insure.
However, some in the insurance industry oppose additional government
involvement and others have set forth alternative proposals. Some
insurance company representatives believe that the private market for
catastrophic coverage for natural events continues to exist and that
insurance costs should be based upon free market principles. Still
others have proposed that insurance companies be permitted to set aside
additional catastrophic disaster reserves on a pre-tax basis.
Supporters of tax-deductible reserves argue that the tax-free status
would give insurers a financial incentive to increase their reserves
and expand insurers' capacity to cover catastrophic risks and avoid
insolvency.
We anticipate undertaking work that would examine the merits of
involving federal and state governments in alternative methods of
insuring against catastrophic disasters--for example, by acting in a
reinsurance capacity. We will continue to monitor legislation and
proposals aimed at the long-term restoration of the Gulf Coast, such as
the recently passed Gulf Opportunity Zone Act of 2005, which contains a
variety of tax-related incentives designed to encourage rehabilitation
in the region.
The Federal Role and Involvement Will Raise Ongoing Issues:
As we move forward, long-term rebuilding in the Gulf Coast raises
issues concerning the need for consensus on what rebuilding should be
done, where and based on what standards, who will pay for what, and
what oversight is needed to ensure federal funds are spent for their
intended purposes. Over 20 years ago, we issued a report describing the
U.S. government's involvement and experience in four large-scale
assistance programs (Conrail, Lockheed, New York City, and Chrysler)
and suggested guidelines for future programs in helping other failing
firms or municipalities.[Footnote 24] That report described four
conditions that we suggested the Congress could use as a framework of
ideas about how to structure future financial assistance programs and
what program requirements to include to achieve Congressional goals and
objectives while minimizing the risk of financial loss to the
government. Congress might consider such guidelines as it considers
federal assistance to the Gulf Coast for restoration:
* The scope of the problem should be identified, such as if the problem
reflects broader industry-wide or regional economic conditions. For the
Gulf Coast, this would involve financial and economic analyses, perhaps
utilizing current studies of prior conditions and the ongoing progress
of recovery and rebuilding.
* The effect of the problem on the national interest should be clearly
established, for example, whether the problem presents potentially
large economy-wide or regional consequences. For example, in the Gulf
Coast, Congress might consider the costs of municipal and corporate
collapse and the challenges associated with providing assistance.
* The legislative goals and objectives associated with the response
should be clear, concise, and consistent. For example, in the Gulf
Coast, goals and objectives for rebuilding should be clearly stated,
working with the state and local groups already tasked with recovery
planning and with the Administration's Coordinator of Federal Support
for the Recovery and Rebuilding of the Gulf Coast region.
* Lastly, the government's financial interest should be protected. In
the Gulf Coast, controls might be put in place so there is review of
the most important financial and operating plans.
Concluding Observations:
Madame Chairman and members of the committee, the past several weeks
have provided significant insights into the Hurricane Katrina
catastrophic disaster with the release of the House Select Committee
report, the White House report on the federal response, and the
testimony provided to this committee. Secretary Chertoff has announced
immediate actions in preparation for the upcoming hurricane season and
plans to work with the White House and the Homeland Security Council to
assess and address the White House recommendations. Findings, lessons
learned, and observations all paint a complex mosaic of challenges the
federal, state, and local governments face in preparing for, responding
to, and recovering from catastrophic disasters. This committee's report
as well as GAO's work will add to the understanding of what happened
and what needs to be done.
Moving forward, the challenge will be to determine if the
recommendations and initial and longer-term actions will truly close
the gap in needed preparedness or add to the problem through additional
bureaucracy, complex processes, and inflexible policies. Also, the key
question remains if the revised policies and procedures, even if sound,
will be effectively implemented. Will they join those past
recommendations that were not implemented, resulted in actions that
were not sustained, or proved to be inadequate? We look forward to
working with this committee and others to focus our work on these key
issues.
This concludes my statement. I would be pleased to respond to any
questions that you or other members of the committee may have at this
time.
GAO Contacts:
Contact points for our Offices of Congressional Relations and Public
Affairs may be found on the last page of this statement. For further
information about this testimony, please contact Norman Rabkin at (202)-
512-8777 or at rabkinn@gao.gov.
[End of section]
Appendix I: Recent GAO Products Concerning Hurricanes Katrina and Rita:
Emergency Preparedness and Response: Some Issues and Challenges
Associated with Major Emergency Incidents. GAO-06-467T. Washington:
D.C.: February 23, 2006.
Disaster Preparedness: Preliminary Observations on the Evacuation of
Hospitals and Nursing Homes Due to Hurricanes. GAO-06-443R. Washington:
D.C.: February 16, 2006.
Investigation: Military Meals, Ready-To-Eat Sold on eBay. GAO-06-410R.
Washington: D.C.: February 13, 2006.
Expedited Assistance for Victims of Hurricanes Katrina and Rita: FEMA's
Control Weaknesses Exposed the Government to Significant Fraud and
Abuse. GAO-06-403T. Washington: D.C.: February 13, 2006.
Statement by Comptroller General David M. Walker on GAO's Preliminary
Observations Regarding Preparedness and Response to Hurricanes Katrina
and Rita. GAO-06-365R. Washington, D.C.: February 1, 2006.
Federal Emergency Management Agency: Challenges for the National Flood
Insurance Program. GAO-06-335T. Washington, D.C.: January 25, 2006.
Hurricane Protection: Statutory and Regulatory Framework for Levee
Maintenance and Emergency Response for the Lake Pontchartrain Project.
GAO-06-322T. Washington, D.C.: December 15, 2005.
Hurricanes Katrina and Rita: Provision of Charitable Assistance. GAO-
06-297T. Washington, D.C.: December 13, 2005.
Army Corps of Engineers: History of the Lake Pontchartrain and Vicinity
Hurricane Protection Project. GAO-06-244T. Washington, D.C.: November
9, 2005.
Hurricanes Katrina and Rita: Preliminary Observations on Contracting
for Response and Recovery Efforts. GAO-06-246T. Washington, D.C.:
November 8, 2005.
Hurricanes Katrina and Rita: Contracting for Response and Recovery
Efforts. GAO-06-235T. Washington, D.C.: November 2, 2005.
Federal Emergency Management Agency: Oversight and Management of the
National Flood Insurance Program. GAO-06-183T. Washington, D.C.:
October 20, 2005.
Federal Emergency Management Agency: Challenges Facing the National
Flood Insurance Program. GAO-06-174T. Washington, D.C.: October 18,
2005.
Federal Emergency Management Agency: Improvements Needed to Enhance
Oversight and Management of the National Flood Insurance Program. GAO-
06-119. Washington, D.C.: October 18, 2005.
Army Corps of Engineers: Lake Pontchartrain and Vicinity Hurricane
Projection Project. GAO-05-1050T. Washington, D.C.: September 28, 2005.
Hurricane Katrina: Providing Oversight of the Nation's Preparedness,
Response, and Recovery Activities. GAO-05-1053T. Washington, D.C.:
September 28, 2005.
FOOTNOTES
[1] GAO, Expedited Assistance for Victims of Hurricanes Katrina and
Rita: FEMA's Control Weaknesses Exposed the Government to Significant
Fraud and Abuse. GAO-06-403T. (Washington: D.C.: February 13, 2006).
[2] See, for example, GAO, Disaster Management: Improving the Nation's
Response to Catastrophic Disasters, GAO-93-186 (Washington, D.C.: July
23, 1993) and GAO, Disaster Management: Recent Disasters Demonstrate
the Need to Improve the Nation's Response Strategy, GAO-93-46
(Washington, D.C.: May 25, 1993).
[3] 42 U.S.C. §§ 5121-5206.
[4] Pub. L. No. 107-296, 116 Stat. 2135 (2002).
[5] The NRP notes that major disasters and emergencies under the
Stafford Act are examples of this criterion.
[6] GAO, Statement by Comptroller General David M. Walker on GAO's
Preliminary Observations Regarding Preparedness and Response to
Hurricanes Katrina and Rita, GAO-06-365R (Washington, D.C.: February 1,
2006).
[7] GAO-93-46 summarizes GAO work in 1993 that contains this
recommendation.
[8] GAO, Hurricanes Katrina and Rita: Preliminary Observations on
Contracting for Response and Recovery Efforts, GAO-06-246T (Washington,
D.C.: November 8, 2005).
[9] For additional information, see GAO, Disaster Preparedness:
Preliminary Observations on the Evacuation of Hospitals and Nursing
Homes Due to Hurricanes, GAO-06-443R (Washington, D.C.: February 16,
2006).
[10] GAO, Hurricanes Katrina and Rita: Provision of Charitable
Assistance, GAO-06-297T (Washington, D.C.: December 13, 2005).
[11] A summary of GAO's risk management framework specifically related
to homeland security and combating terrorism can be found in GAO, Risk
Management: Further Refinements Needed to Assess Risks and Prioritize
Protective Measures at Ports and Other Critical Infrastructure, GAO-06-
91 (Washington, D.C.: December 15, 2005).
[12] GAO, Homeland Security: DHS' Efforts to Enhance First Responders'
All-Hazards Capabilities Continue to Evolve, GAO-05-652 (Washington,
D.C.: July 11, 2005).
[13] H. R. Rep. No. 109-241, at 68 (2006).
[14] Pub. L. No. 109-59, 119 Stat. 1144, 1934 (2005).
[15] Department of Homeland Security, Nationwide Plan Review Phase 1
Report (Washington, D.C.: February 10, 2006).
[16] GAO, Homeland Security: Critical Design and Implementation Issues,
GAO-02-957T (Washington, D.C.: July 17, 2002).
[17] GAO, Major Management Challenges and Program Risks: Department of
Homeland Security, GAO-03-102 (Washington, D.C.: January 2003).
[18] GAO-93-186.
[19] GAO-03-113.
[20] U.S. President (G.W. Bush), "Establishment of a Coordinator of
Federal Support for the Recovery and Rebuilding of the Gulf Coast
Region," E.O. 13390, Federal Register, vol. 70, Nov. 4, 2005, p. 67327-
67328.
[21] MCLNO announced plans to re-establish Level I trauma unit in the
New Orleans area working in conjunction with another facility.
[22] The internet database is called "GNOEMS" and was developed by the
Greater New Orleans Healthcare Taskforce with the assistance of the
U.S. Public Health Service.
[23] In comparison, SBA issued loan applications for the Northridge
earthquake and the Florida hurricanes of 2004, totaling about 570,000
and 870,000, respectively. For those two disasters, SBA received loan
applications totaling about 250,000 for Northridge and about 180,000
for the Florida hurricanes.
[24] See GAO, Guidelines for Rescuing Large Failing Firms and
Municipalities, GAO-84-34 (Washington, D.C.: Mar. 29, 1984).
