BATON ROUGE, La. - Since the beginning of the state's innovative Express Pay system last March, the Louisiana Recovery Authority and the Governor's Office of Homeland Security have quickened the pace of recovery by cutting down payment wait-times in FEMA's Public Assistance program from nearly 60 days to an average of eight business days.
Also during its first year, the Express Pay system made payments to 4,231 local governments and nonprofits totaling $865 million.
Louisiana Recovery Authority Executive Director Paul Rainwater said, "Prior to January 2008, the previous administration took anywhere from 45 to 60 days to reimburse local governments for expenses incurred on rebuilding projects. This was extremely difficult for contractors, because many small businesses simply couldn't wait that long to be paid for work already accomplished.
"We took a long, hard look at the process and found an extraordinary amount of paperwork was required for payments," Rainwater said. "Expense reimbursements are critically important in keeping our rebuilding projects moving forward, so we had to eliminate this bottleneck. The last thing we want is delayed recovery because of late payments. Unlike the former process, which was unfriendly to business, Express Pay allows the speed of government to keep pace with the speed of business."
Governor's Office of Homeland Security Director Mark Cooper said, "When government runs more efficiently, things get done in a timely manner. More companies will be willing to do business with the state of Louisiana now that we have a better system in place."
Overall, in the PA program for Hurricane Katrina there are 2,161 applicants, representing 17,927 projects amounting to $3.79 billion in payouts. For Hurricane Rita, there are 931 applicants representing 4,464 projects amounting to $404 million in payouts.
Express Pay works by educating applicants on the reimbursement process and deferring detailed review of documentation until after payments are issued. If the state determines there has been an overpayment, the applicant is issued a credit against the next reimbursement.
Backed by the legislative auditor, the Express Pay system ensures accountability and transparency while speeding up recovery without opening the door to fraud.
The PA program provides state and local governments and some nonprofit organizations with funding for recovery measures such as rebuilding of buildings, roads, bridges and water and sewer plants. PA funds are obligated by FEMA through project worksheets. Once the funds are obligated, the applicant must request reimbursement from GOHSEP for eligible work completed. Obligated funds may change over time because the project often is adjusted as bids come in and the scope of work is aligned. All project worksheets are paid up to 90 percent of the obligated amount, with the remaining 10 percent held as retainer until a detailed review of the final request for reimbursement has been completed.
Created in the aftermath of Hurricane Katrina and Hurricane Rita in 2005, the Louisiana Recovery Authority (LRA) is the coordinating and planning body leading the most extensive rebuilding effort in American history. The central point for hurricane recovery in Louisiana, the LRA works closely with the Governor's Office of Homeland Security and Emergency Preparedness (GOHSEP) and partners with state and federal agencies to oversee more than $20 billion worth of programs, speed the pace of rebuilding, remove hurdles and red tape and ensure that Louisiana recovers safer and stronger than before.
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