On January 19, the House Financial Services Committee held a hearing titled “Ensuring Equitable Delivery of Disaster Benefits to Vulnerable Communities and Peoples: An Examination of GAO's Findings of the CDBG Program.” The hearing focused on the degree to which Federal disaster recovery resources, specifically HUD’s Community Development Block Grant - Disaster Recovery (CDBG-DR) program, are meeting the unique needs and challenges of vulnerable populations in the wake of natural disasters.

The Committee heard from five expert witnesses on the topic: Daniel Garcia-Diaz, Managing Director, Financial Markets and Community Investment, U.S. Government Accountability Office; Diane Yentel, President and CEO, National Low Income Housing Coalition; Chrishelle Calhoun-Palay, Director, HOME Coalition; Andreanecia Morris, Executive Director, Housing NOLA; and Stephen Begg, Deputy Inspector General, U.S. Department of Housing and Urban Development Office of Inspector General.

Background

In November 2021, the Government Accountability Office (GAO) released a study titled “Disaster Recovery: Better Data Are Needed to Ensure HUD Block Grant Funds Reach Vulnerable Populations”, which evaluates the delivery of CDBG-DR assistance to vulnerable populations at the request of Chairwoman Maxine Waters and Representative Al Green. Specifically, GAO was asked to assess the accessibility of CDBG-DR program benefits to members of vulnerable populations, including: (1) persons who are older and/or who have disabilities; (2) persons of low or moderate-income; and (3) racial minorities and members of the LGBTQ+ communities. The House Financial Services Committee held the hearing to examine GAO’s findings and collect broader recommendations from the witnesses to ensure Federal disaster relief is accessible to members of vulnerable populations.

Key Takeaways

Although GAO recognizes that HUD’s CDBG-DR funds provide significant, flexible federal recovery funding for states and localities affected by disasters and found through their study that the program is focused on vulnerable populations, the lack of data available to grantees and standardization of requirement leaves applicants, beneficiaries, and grantees of vulnerable communities at disadvantage.

One theme rang clear during the hearing: America’s disaster housing recovery system needs major reform as the system currently fails to address the unique needs of the lowest-income and most marginalized people. Witnesses touched the ad hoc nature of the CDBG-DR program as Federal Register Notices that are required before funds can be used take months and in extreme cases, years to be published, leaving communities waiting to access funds appropriated for them. Funding delays often mean vulnerable populations with limited resources continue living in damaged or compromised homes while waiting for an opportunity to request long term recovery assistance.

In their testimonies, witnesses identified several key opportunities to improve HUD’s disaster recovery program, including:

• Permanently codifying the CDBG-DR program: The permanent authorization of the program would provide a more consistent framework for administering disaster assistance. Codification would provide clarity and consistency for grantees about core requirements, help disaster assistance reach victims sooner and ensure funds are equitably distributed. Codification is an important step towards achieving effectiveness and accountability in long term disaster recovery.
• Increasing availability of demographic data: HUD should gather, analyze and make public additional data of the applicants and recipients of CDBG-DR across a range of demographic characteristics to accurately identify gaps in disaster recovery resources. Data transparency and equity would better assess whether CDBG-DR funds are effectively reaching survivors with the greatest needs and lead to proper oversight of the program.
• Building grantees’ capacity: Capacity limitations often result in grantees struggling to reach the most vulnerable members of communities. Grantees with limited capacity are more likely to use funds for ineligible activities or be unable to detect and prevent fraud. Streamlining HUD’s process and standardizing requirements could help grantees build capacity to administer disaster grants that are massive in size and scope.
• Strengthening interagency collaboration: Intentional collaboration and reliance on the lessons learned are crucial to inform program planning and assure preexisting capacity exists. FEMA and HUD should explore gaps and opportunities for coordination between agencies to better serve populations in need, require grantees to prioritize racial and social equity, as well as adopt general standards to guide disaster recovery and mitigation efforts.

Q&A

Following witness statements, members of the Committee were given time to question witnesses. Questioning took on several themes including the impacts of disasters on the nation’s housing stock, the role of the Reforming Disaster Recovery Act in achieving equitable recovery, changes needed to ensure that funds are used for the intended purposes, as well as the role that data collection and transparency can help the program better target underserved populations.

Watch the full hearing here.

Enterprise strongly supports the enactment of the Reforming Disaster Recovery Act (H.R. 4707 and S. 2471), which was introduced in both the House and Senate in July 2021 with bipartisan support. The bill would permanently authorize the CDBG-DR program and make the flow of disaster recovery funds faster, more equitable, and more accountable to taxpayers. The legislation would also address several issues raised in the hearing including increasing oversight and data transparency, improving interagency coordination, requiring HUD to release information on disaster recovery to the public, as well as developing a formula to allocate assistance to the most impacted areas.