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Mr. MONCHEUR. Small Business Administration.

Senator Ives. Well, just a moment. I think there is a full record of those loans or applications that have been filed. Do you want to send me a letter regarding that loan business? I will follow it


for you.

Mr. MONCHEUR. I will be glad to, Senator.

Senator LEHMAN. Are those applications made by people in your area?

Mr. MONCHEUR. That is right. In my case I did not make any application to anybody since I did not consider the loss big enough to warrant a loan from the Small Business Administration.

The feeling of all the people is that it is easier, actually, if you have the collateral, to obtain a loan from a bank where you are known, than from the Small Business Administration.

That relates to getting back into business when you are hit by the flood.

But I understand we here today are discussing mostly the insurance angle, and what we citizens think could be done. I discussed that with a number of my neighbors again last night and this morning, and we came to the conclusion that maybe what should be done should be big, should be done by the Federal Government, and if possible, not at cost to the taxpayer. It should be done, if necessary, by taking up a big loan. We have been thinking of something of the sort like war bonds that we have during an emergency like a war. So that in a case like this it would be possible to take up a loan that would be called a conservation bond, which would give the Government $3 billion, $5 billion, or $10 billion, or whatever would be necessary-or maybe all that is necessary is for the Government to subscribe such a loan.

The small-business people, and also those among us who are not in business, do not want charity. We want either coverage or we want to be able to take up a loan, if something hits us, on our signature. We are honest people. We want to repay it. But our local institutions are often not in a position to do that, because when we are hit by a catastrophe like Diane, most of us are not prepared. We have mortgages and other debts. If on top of the mortgage and other debt comes the requirement of another $5,000 or $10,000, local banks are in no position to give such a loan. That is why so many of us thought that is where the Small Business Administration comes in. As long as you didn't need it, you thought if anything should ever happen that is where you are going to go. But after it happened, we found practically closed doors.

Senator Ives. To what business are you referring with respect to the loan?

Mr. MONCHEUR. The loan is not for me in particular. I did not apply for a loan. My neighbor, Mrs. Walker, applied for a loan.

Senator Ives. What business is she in?
Mrs. WALKER. Summer resort.

Mr. MONCHEUR. I heard the same thing from people who have a grocery store, a garage, a butcher shop-all the small people who do not have the credit facilities of bigger businesses.

Senator Ives. You understand about the summer-resort business and the Small Business Administration. There had been a period of some delay as to policy where that is concerned. There was quite a


while when they were making up their minds whether they should cover the resort business. Obviously there are certain exceptions where they run into considerable loss. I think finally they are doing it. You may run into that—while this transition is taking place.

Mr. MONCHEUR. I understand that in principle resorts are now eligible for such loans.

Senator Ives. That is right. But they were watching them very carefully.

Mr. MONCHEUR. I know. And I do not blame the Government for doing just that. But at the same time, what concerns me primarily is that small business people, so important to our form of economy these days, do not have the reserves necessary to wait 6 months or a year or 2 years, to remain alive economically. It is of the utmost importance to us as citizens to keep those people alive.

Senator Ives. The ordinary borrowers from the Small Business Administration do not have to wait anything like that. Those loans are processed quickly.

Mr. MONCHEUR. So far in our vicinity we have not heard. I hope for the people who applied they will hear.

Senator Ives. You see, you have a double problem. Yours is a flood problem, plus a resort problem. That may be causing some delay there.

Mr. MONCHEUR. I repeat, sir, that some of the loans that have been applied for do not apply to resorts. They apply to other businesses in Port Jervis. Actually, they are small neighborhood stores and so forth.

Senator Ives. I have the record of applications of Port Jervis inquiries—105. And so far—those were just inquiries; they were not applied for. I think the number applied for was 16 out of that total, after the inquiries were made. And your amount must be somewhere in that 16. Of the 16, which amounted to $114,605, 13 have already been approved, totaling $87,605. One has been declined. That was one for $12,000. I do not think that was yours; was it?

Mrs. WALKER. No; mine is more. Mine was $25,000.

Senator Ives. Two were sent to the regional office. They totaled $15,000. Yours does not seem to be included. You actually made your application, did you?

Mrs. WALKER. Yes—sent it registered mail.
Senator Ives. How long ago?
Mrs. WALKER. A little over 2 weeks.
Senator Ives. Was that $25,000 ?
Mrs. WALKER. Yes.

Senator Ives. Well, that would have to go to the Washington office for approval, and that is what caused your delay. I think anything up to $20,000 is cleared locally, and above that it has to go to Washington.

Mrs. WALKER. Wouldn't they at least acknowledge receipt of the application

Senator Ives. You should have that.
Mrs. WALKER. They didn't. It was sent registered mail.
Senator Ives. You got a return receipt on that.

Mrs. WALKER. No; I didn't get it back. I inquired at the post office yesterday.

Senator Ives. They cannot run it down?

Mrs. WALKER. She is going to try.
Senator Ives. You asked for a return card.
Mrs. WALKER. Yes; I paid for a return receipt.

Senator Ives. Well, that may have gone astray. Of course, that is the post office and not the SBA.

Senator LEHMAN. Senator, I have no facts on this question. I am not forming any judgment as to the accuracy of the figures that we have had. But you will recall that the head of the SBA did testify before us in Washington, and he gave certain figures, which I think you have here. Since then we have had testimony from these people and also from the Stroudsburg people which are considerably at variance with the figures given to us. I have no idea which are accurate. We are going to look into it.

Senator Ives. There was a discrepancy there; yes.
Senator LEHMAN. Will you continue, sir.

Mr. MONCHEUR. The only other thing I would like to mention is if it is possible at all for the Federal Government in Washington, since that is where it has to come from, seemingly, to find a way to cover actual flood losses by insurance. Of course, it would be preferable, as we see it, if it could be done by insurance companies, with the guaranty, maybe, of the Federal Government in this case to start work. But in any case, where the people would be insured, and not only insured for their real estate. Many more people, I know, have been hit in their personal property in the floods of August than people who have lost on real estate. After the water receded the house was still standing, and in most cases it could be repaired if any damage at all was done. But the people who lost their furniture, that was final. I have seen truckload after truckload of furniture being thrown a way in Port Jervis because they had 2, 3, or 4 feet of water on the furniture, and nobody could use it any more. Again, those are the people who are the poorest people in the community. They are people who have families. During a period of years they have accumulated $2,000 or $3,000 worth of personal belongings. If you have to replace such an amount when your children are in the growing stage, as is the case with most of these people, it is practically an impossibility. It puts you into debt for years to come.

Senator LEHMAN. Well, that is, of course, covered by my bill and I think by some of the others. There is a difference of opinion with

. regard to what the coverage will be, but that is why we are holding these hearings. We want to get the advice of people.

I must announce that unfortunately Senator Ives and I have to get back to New York at a reasonable hour tonight to keep engagements of long standing. So I will have to ask the witnesses to be as short as possible, although we do not want to cut anybody off.

Mrs. WALKER. I have a summer resort that I have been operating since 1941. It has been a growing business ever since it started, and I have proof of the same. We have a winding brook that runs through the resort and even with heavy rains it overflows, because the culvert under the road is not large enough to carry the water away. During the flood I suffered damage of $25,000.

The brook needs to be cleaned out. It is full of stones.

My reservoir was completely ruined. That is full of stones. My driveway was completely washed out. My parking lots were completely ruined. There were places in my driveway deep enough to

drown in. My neighbor was kind enough to help me out with his tractor, to push enough dirt around so we were barely able to walk in and out.

The morning of the flood, before we could serve breakfast we had to dig ditches to detour the water, which was running through the dining room, kitchen, and stockroom. The floors in the main building were just about ruined. We lost a considerable lot of linen, and in the

. stockroom we lost a lot of goods.

I can wall up this brook so that it does not break loose again, because I have to give people some assurance so that they will be willing to come back. People are afraid of floods. I lost about $15,000 in business. People canceled reservations due to the flood damage. My interest is in gaining this loan so that I can build back up.

Senator IVES. As I understand, Mrs. Walker, you do not know yet whether they received your application.

Mrs. WALKER. I am quite sure they did, because it was sent registered mail.

Senator Ives. But you did not get your receipt back. They should have received it, but you are not sure they did, because you have not got your card back.

Senator LEHMAN. This would be a loan that you have applied for. Mrs. WALKER. That is right.

Senator LEHMAN. I do not want to ask you what your financial situation is, but if you have got an indebtedness, this would be on top of your other indebtedness.

Mrs. WALKER. That is right. I have very good credit references, bank and otherwise.

Senator Ives. I have received a communication here that your ap. plication was received in New York on October 20. So your dates are more or less accurate. There was delay in acknowledgment undoubtedly due to extra work caused by the second flood.

Senator LEHMAN. I want to point out, for the record, that while I think the SBA has been doing very valuable work and will continue to do so, and I have always been a very strong supporter of it, it is limited to $25 million. The losses in 2 States, North and South Carolina—the minimum estimate I have here is $75. million. That is why they can do so little. That is why we are interested in this legislation. Senator Ives. I will keep that and see what happens to it.

Senator LEHMAN. Is Supervisor Burton Marshall of the town of Rochester here?



Senator Lehman, Senator Ives, I have brought with me a delegation of three men from our town, Ed Carle, John Schoonmader, and Ed Davenport. I am Burton Marshall, supervisor of the town of Rochester. I picked these men out who I felt were the individuals who had some of the biggest loss in our town.

In regard to this insurance, the bill that you are putting up, we felt that their testimony might be better than my own. I had very little

I know something about the damage done by floods, because we had a great flood in the southern tier. Some of you may remember that. That was in 1936, during the time I was Governor. I went down there and spent a week there, and I saw from personal observation the damage that occurred. One of the great damages was just what you suffered from the floods coming into the stores, factories, homes, and damaging personal property or inventory.

In holding these hearings, we are trying to make a very complete record. This is the fourth hearing we have had. We are going to have a number of others. I am sure the record is going to be read pretty carefully by members of the Banking and Currency Committee, which will be charged with the duty of drafting legislation for submission to Congress, if that is possible.

But do not forget that regardless of what the Banking and Currency Committee wants to do, or certain members of the Banking and Currency Committee, there are 96 Members of the Senate and there are 431 Members of the House of Representatives. Only a very small percentage of those men and women really have any comprehension of the damage, the loss, the suffering that comes from natural disasters. Very few of them have. The task will be to educate those people. Don't let's fool ourselves. Legislation of this character, which is complex, is going to be the subject of long discussion and argument, and considerable opposition.

You men and women in this district, as well as many other districts of the country, can render tremendous service by telling your story to your representatives in Congress and to the community as a whole. This is a proposition on which education has to be carried on.

I do not believe that any 3 or 4 or 5 members of the Banking and Currency Committee alone can do the job of educating the Members of both Houses of Congress. It is the duty of every man living in a community which has suffered from this thing to get up and tell his story to as many people as possible, describe the losses and suffering. It is just not understood.

I make that appeal to you. I am going to make it at other hearings. But I think it is highly important.

As the next group of witnesses we have Mayor Eugene Glusker and a delegation from Ellenville, including Supervisor Sprague and Mr. Charles Kaiser and Mr. Harry Thayer.



Mayor GLUSKER. My name is Eugene Glusker; this is Mr. Thayer and this is Supervisor Sprague.

From my interpretation of the brochure sent out by your committee, it is my impression your hearing here today is for a double purpose. One is to get some idea as to the destruction and, secondly, the possibility of insurance as a solution to the problem.

The total destruction in Ellen ville consisted of 7 homes, 1 factory, ar large recreational building belonging to a church.' Partially

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