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U.S. Senate takes up $60 billion Sandy bill amid charges of waste

By David Lawder

WASHINGTON (Reuters) - The U.S. Senate on Monday began debating a $60.4 billion aid bill to rebuild communities devastated by Superstorm Sandy amid criticism by conservative groups who said the measure was loaded with wasteful, non-disaster spending.

The Democratic-controlled Senate is looking to pass the disaster aid bill this week. But Republicans, wary of its huge price tag in the midst of tense debt and deficit negotiations in Washington, are likely to try to ratchet back some of its provisions through amendments.

Meanwhile, the House of Representatives is taking a slower, more painstaking approach to analyzing the Obama administration's request for funding to rebuild coastal communities largely in New York and New Jersey, repair transportation infrastructure there and provide other aid.

The House Appropriations Committee Chairman Hal Rogers, a Kentucky Republican, hopes to move an aid measure before year-end but has been considering a smaller initial bill aimed at meeting immediate disaster needs.

The conservative Club for Growth urged senators to vote against the Sandy relief bill, saying that it contained a lot of "immaterial" spending.

"When a natural disaster occurs, there is a textbook response by Congress - they cobble together an overpriced bill that isn't paid for, there's no accountability or oversight, and it's filled with pork. This proposal is no different," the group said in an email to senators.

Among spending items in the Senate bill drawing the ire of Washington conservatives is one seeking $150 million for fishery disasters in Alaska and Mississippi - thousands of miles from the Sandy damage. The bill also includes a request of $50 million for the National Park Service's historic preservation fund and nearly $9 million to replace vehicles and other equipment used by the Departments of Justice and Homeland Security.

Even some local New Jersey politicians criticized the bill.

"A full 5 percent of the appropriation request is earmarked for the replacement of federal assets, rather than rebuilding and aid efforts in the tri-state area," New Jersey State Senator Joe Pennacchio, a Republican, said in a statement, referring to New Jersey, New York and Connecticut.

The three states had initially requested $82 billion in aid, although damage estimates were expected to rise over time. Some of the rebuilding costs were expected to be covered by private insurance.

Some lawmakers are also questioning the bill's inclusion of infrastructure upgrades aimed at mitigating damage from future storms. For example, $5.5 billion would be allocated to the Federal Transit Administration to make transportation systems more resilient in high winds and floods, including efforts to keep tunnels from flooding.

Republicans also questioned the need to push through the full $60.4 billion at once, given that the Congressional Budget Office estimates that only about $9 billion in aid will be disbursed in 2013.

"Let's do this in a real way. Look at how much we're going to spend each year, and do it on an annual basis," Senator Bob Corker, a Republican from Tennessee, told Reuters last week.

But Democrats, displaying large photographs of flooded subway stops and houses turned into splinters, defended the bill on Monday, saying that Congress has always provided disaster recovery aid and the need after Sandy was massive.

Appropriating funds in small increments was unworkable, they argued, because transit agencies, businesses and communities needed certainty that reimbursement money will be available or they cannot start reconstruction projects.

Senator Robert Menendez, a New Jersey Democrat, said this was particularly important for large, multi-year transit projects - such as those required in his state.

"If we don't put up the money, then some of the rebuilding will wait. A piecemeal recovery is a stalled recovery," Menendez said.

Senate Republican aides did not immediately have details on their party's proposed amendments.

The Obama administration, which requested the $60.4 billion aid packages just over a week ago, signaled that it is willing to accept some changes, saying in a statement that it "looks forward to working with the Congress to refine the legislation." (Editing by Philip Barbara)

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