we had removed the water from the different cellars in the community.

The underpass which goes under the railroad was full of water, and they were about 16 hours straight pumping that out.

The water came up and it flooded the dike and went over the dike. I happen to live right along the Delaware, and it was just a question of whether I was going to have it in my house or whether I wasn't. I was fortunate. It didn't quite reach me. Alderman Latini was not quite so fortunate.

There is no feeling as helpless as that when something like that happens. You just can't do anything. These people suffered a great loss, and it would be a wonderful thing if we could get some insurance to help these people if it happens again, even though we know that it is probably impossible for any insurance company to take on this risk by itself. But, nevertheless, it has been necessary for the Federal Government and the States to come in and give assistance.

So I think myself-this is my own opinion-that we might better contribute ahead of time in small amounts instead of having to do it all in one lump.

That is all I have to say.

Mr. LATINI. Senators, I may add to Mr. Murphy's statement here on the flood-I have been closely associated with it, not only because I am a sufferer of this vicious thing, but we have to realize that Port Jervis is under constant threat. We have the Delaware, which engulfs the Delaware Valley and, of course, the Neversink, which comes into the Delaware River. As a result of that, the Delaware River is a much larger body of water, and when the Delaware Valley collectively picks up all these rains that may have come about throughout the upper end of the valley, when it builds up, coming into Port Jervis, down through the Delaware, it has a tendency to back up the Neversink, and that constitutes a threat.

We have numerous dams that offer a threat as far as Port Jervis is concerned, and we have been very fortunate. We had been threatened, there had been a rumor that Wallenpaupack was going to go out, and naturally people were once again on edge. Fortunately, it was just a vicious rumor. There was no threat there. But it does offer a threat. If there should be a continued rainfall, such as we had around that time of the 19th, you can readily see the damage that might be incurred.

We have suffered much. It was more of a personal property matter than it was real property. But if these dams should go out, then you would come into total destruction, especially in the flat sections of Port Jervis.

Senator LEHMAN. What kind of dams are these? Are these floodcontrol dams?

Mr. LATINI. No, they are power dams. Of course, we have a threat overhanging the city, our reservoirs, and some sort of flood control should be instituted so that we will have a certain amount of protection and this threat won't be hanging over our heads.

But the purpose at this meeting is to study the insurance situation here, and definitely there is a need, and I honestly believe that there is only one possible way and that is through the Federal Government. Senator LEHMAN. I do want to say, parenthetically, that although

this committee of ours has not been directed to look into the question of flood control, we are very much interested in it. We feel that the Federal Government should do much more in the way of flood control, not only for the State of New York but in various parts of the country, than they have been doing. The appropriations have been quite inadequate, in my opinion, over the past few years, and the Chief of Engineers testified that if the appropriations were continued on approximately the same basis as they have been in the past, just to take care of the projects already approved by the Corps of Engineers would take 22 years, which is a long time to wait.

Senator Ives.

Senator IVES. I would like to ask either one of the aldermen whether they know about any loans that have been applied for by any of the merchants or persons in Port Jervis or vicinity who lost property as a result of the flood, loans that have been applied for with the Small Business Administration.

Mr. MURPHY. I know there were. I can't tell you the amount or the number, but I know there were several loans applied for and several loans made, but the extent I can't tell you.

Senator IVES. They have received the loans, then?

Mr. MURPHY. Yes, they did.

Senator LEHMAN. May I ask you, have you any estimate of the damage suffered by your city?

Mr. MURPHY. You mean the people of the city, not to the sewers or streets or anything?

Senator LEHMAN. Yes; I would like to have both.

Mr. MURPHY. Well, we estimated it around $7 million. That is the streets and the dikes. The personal and real property are approximately, maybe $500,000.

Senator LEHMAN. Have you any idea how much the loans that were granted by the Small Business Administration or by other governmental agencies amounted to?

Mr. LATINI. The only thing we could do is give you maybe something approximate. Maybe it won't even come close to the figures. But I would approximate that small-business loans may have come close to a figure of a hundred thousand, which is probably just a round figure.

But, all in all, we have to realize that many businessmen that have suffered losses sometimes would try to take on the loss themselves, but they not only have lost the question of real property or maybe personal property but there is a question of losing time.

They may take a month, maybe a month and a half, or 2 months before they get back in business, and their business is keen. If it is a competitive business, you can see where his losses would be as far as income is concerned. So we not only have losses as far as personal property or real property but we have income losses also; and I can stress that strongly. I have been closely associated with this thing from beginning to end, and I have been associated with some of the charitable institutions that have done a wonderful job in rehabilitating the people of Port Jervis. But their powers are limited, their policies are limited, and I sincerely believe that the Federal Government, instituting something like this, this type of legislation, would be a partial answer for the people.

Senator LEHMAN. At some of our hearings it was advanced and strongly supported that the Red Cross would be able to take care of a great part of this damage. I know that the Red Cross is a great emergency relief organization, for whom I have the highest regard. But I wonder whether their resources are large enough or would be large enough to help any substantial number of people rebuild their houses. Have you had any experience on that.

Mr. LATINI. I don't wish to take over the floor here, but I have been associated with the Red Cross in an advisory capacity, inasmuch as my district had been stricken with this thing. All I could do was voice the situation and do the best I could as far as Red Cross and the people were concerned. I will say this. Their policy is limited to the extent that they may go. If you are in the category of handling the situation yourself, you may secure a loan through Small Business. But if you are in a position where you might be destitute and you have to have some assistance, they have gone into business also-that is, Red Cross. And I will say this. They have been doing a wonderful job. But then again, their policies are limited, and only in some instances can they give assistance in business.

But there again, the question of this insurance would be protective to the resident and to the businessman.

Senator LEHMAN. Thank you very much, indeed, gentlemen.

I am told that Assemblyman Wilson Van Duser, and also Supervisor Hammond of Port Jervis are present. I know they are not scheduled as witnesses, although they were invited. But if they have any brief comments, we would be very glad indeed to hear them.

STATEMENT OF WILSON VAN DUSER, MEMBER, NEW YORK STATE ASSEMBLY

Mr. VAN DUSER. Thank you, Senator. I do not care to testify. I am here as an observer. I have been in very close touch with the members of the board of supervisors of Port Jervis. Governor Harriman never asked the members of the assembly to take any specific action. He hoped that the whole thing would be handled by the different boards of supervisors. I have been working constantly with them. Every member of my board is very cooperative and they have done everything they could to help look after the situation."

Senator IVES. May I ask a question. Have you found that the help from the Federal Government has been as adequate as could be expected with the laws as they are?

Mr. VAN DUSER. I think in an emergency of this kind and size, we have had very satisfactory help from the Federal Government so far. Their advice and their initial action indicates that they are going to seriously take care of, this thing. It is going to take a little time, like all things that the Government handles. But I expect that they will in time do about what the people have asked for and it will be all right.

Senator IVES. Do you know anything about the number of applications for loans from the ESBA which have been made?

Mr. VAN DUSER. I do not know too much about the Small Business Administration loans. Frankly it is the little property owner or homeowner whose home or property has been destroyed or injured

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in such a way that he doesn't even know how to go about asking for these loans, and so forth.

Senator Ives. He would be the fellow that could not possibly get a loan because there is no business involved there. He is the one we are principally interested in, as a matter of fact.

Mr. VAN ĎUSER. Well, I think that the supervisors have been listing all of those people, and eventually, through the advice of the supervisors, they will be granted some kind of a hearing so they can express themselves.

Senator IVES. The Small Business Administration does make homedisaster loans.

Mr. VAN DUSER. Well, that is good to know.

Senator LEHMAN. Both the Small Business Administration and the Housing and Home Finance Agency are prepared to make loans to people in business and to rebuild or rehabilitate homes in a limited amount. But in all those cases, what I want to emphasize is that they are loans which have to be repaid. We have known of many cases where people have lost their homes or had their homes so badly damaged that they were virtually useless, and they have nothing left except the mortgage to which they are obligated and have to pay.

What we are very much concerned with is that even though a man may get a loan to rebuild his home of, say, $7,000, that would be on top of the mortgage of $7,000 for which he is still responsible, making a total obligation of $14,000, maybe, on a $10,000 home. As many of us view it, unless a man has got a very substantial income, he just cannot carry that loan. Whereas if he were compensated for his original loss, then of course he would suffer very little loss.

Mr. VAN DUSER. He would have a little ray of hope, then, Senator. Senator LEHMAN. That is right.

Mr. VAN DUSER. That's the trouble. I talked to a man in Port Jervis who had the exact experience you speak of-a brand new house, not quite finished, on which he owed $7,000 or $8,000. The house was absolutely ruined. Now he is so discouraged he doesn't know where to start. It isn't just a case of borrowing. I suppose his thoughts are something like this. "Why should I borrow to replace something here that may be washed out again."

Senator IVES. Is anything being done in Port Jervis to straighten out the housing locations?

Mr. VAN DUSER. Yes, sir.

Senator IVES. Do you have any local zoning legislation to keep these people out of the valleys?

Mr. VAN DUSER. Yes. Mayor Cole is on his way down here and will be here later, and he will tell you more about Port Jervis. He knows much more about it, of course, than I do.

Senator IVES. You are from Middletown?

Mr. VAN DUSER. Yes. I have been up to Port Jervis many times, but I think the mayor should speak for the city when he gets here. Senator LEHMAN. Thank you very much. I will call on Alderman Frank Gesaldo of Middletown as the next witness.

STATEMENT OF FRANK GESALDO, ALDERMAN,

MIDDLETOWN, N. Y.

Mr. GESALDO. I have some notes here, Senator. I am going to be very brief. I am alderman of the first ward in Middletown. The damage up there has been a lot more than the public has been led to believe. I took a quick survey of some of the properties that were damaged and people hit. As was stated here before by the mayor, most everyone hit there are people with a low income, which is a big blow to them.

Senator IVES. Unhappily, that is the way it usually is with floods. Mr. GESALDO. A Mr. Robinson, 18 Sterling Street, had damage to his home of approximately $3,000. That is a lot of money to a person who is in the middle-class income group. And Mr. Shoemaker, his entire household furnishings were lost. This has never been revealed by anyone in the city of Middletown. I took it upon myself to reveal this.

Mrs. Enwright said she only suffered about $100, but they are on pension, which means a lot of money to them. They are old people, between 70 and 80.

Then I interviewed a couple of business places there. A Mr. Sagby at the corner of Fulton Street and East Avenue-the damage to him was a little over $6,000. That is on the first flood. Then we had a little secondary flash there which added a few more thousand dollars. Mr. Martini-the foundation on his home was destroyed, and you know what that would cost in labor and materials. Then a Mr. Doolittle at 16 Sterling Street-he had damage of over a thousand dollars. The poor fellow has a cancer, cannot talk, he lost his voice box-so the loss is a serious blow to him. He had his car destroyed, a 1951 Kaiser, truck damaged, driveways washed out, furnishings lost. A Mr. Stewart, who is in the moving and storage business, has approximately $5,000 damage to merchandise and household furnishings that he had in storage, which is supposed to be covered by insurance if the owners have it. If they do not, he has to pay that out of his own pocket. Of course, he is a young fellow, trying to get along. And that is beside the labor cost.

Then we have the Whittaker Rug Co. They estimated their damages at over $7,000.

Senator IVES. Is this all on account of the Wallkill River backing up?

Mr. GESALDO. Yes. We have a condition there in Middletown where two brooks start from opposite ends of the town, but they come together in this area. Of course the floodwater that comes in there, as they come together, it is bound to force back.

Senator IVES. You have a flood-control project on your hands there, haven't you?

Mr. GESALDO. Yes; that is what I am primarily interested in.

Senator IVES. Would not a flood-control project straighten that out? Mr. GESALDO. Yes. I had the State down and they were going to send an engineer down here at some future date, after they got caught up with all their other work. I was advised then that the only way you could control that is to go to the headwaters of these streams and go all the way down to the Wallkill River. Because if we just