American Office of the President and
Chief Executive Officer
Red Cross

National Headquarters
430 17th Street. NW.
Washington, DC 20006

January 27, 2016

The Honorable Bennie Thompson
Ranking Member

Committee on Homeland Security
1-12?117, Ford House Of?ce Building
Washington, D.C. 20515

Dear Ranking Member Thompson:

Thank you for your letter dated December 23, 2015. I am pleased to address how the American
Red Cross has responded to the challenges we have faced in recent years and to describe the steps we have
taken to ensure that the Red Cross is always ready to serve our nation by caring for the public in times of
need.

The American Red Cross has been performing its lifesaving mission for 134 years. We bring
shelter, food, and comfort to those affected by disasters, large and small. We provide support to our men
and women on military bases around the world, and to the families they leave behind. We educate
communities through our CPR, ?rst aid, and other training programs. We collect lifesaving donated
blood and supply it to patients in need. And we assist our neighbors abroad with critical disaster
response, preparedness and disease prevention efforts. We are able to accomplish all of this with almost
no federal funding, thanks to the generosity of our donors and the help of nearly 330,000 volunteers in
communities across this country.

When I came to the Red Cross in the summer of 2008, the nation was in the midst of a ?nancial
crisis, and the Red Cross itself faced a number of challenges, including numerous changes in leadership, a
$209 million annual operating deficit, an unwieldy and inefficient organizational structure, outdated IT
and other systems, and fundraising that lagged behind expenses. We had to turn the organization around
if we were to preserve this American treasure and continue to provide the needed level and quality of
service to the public.

Fortunately, a year earlier in 2007, the US. Congress passed the American Red Cross
Modernization Act, which empowered us to make many of the operational changes necessary. Among the
changes, which are still considered a model of good governance today, the Board of Governors was
reduced in size from 50 to its current 16 members, which is in compliance with the Act?s mandate that the
size of the board be between 12 and 20 members. With the Modernization Act in effect and more clear
roles and responsibilities established, the Board was better able to oversee the organization. With input
from our local chapter leadership and volunteers, we put in place a plan to literally save the American Red
Cross.

Turnaround I

Our ?rst step was to restructure our chapter network to function more as "One Red Cross" and
less as separate entities, each with its own different hiring and pay practices, bank accounts, service
delivery models, etc. This restructuring allowed us to create greater efficiencies, eliminate duplication
and increase collaboration. We consolidated and centralized support services and back-office functions
such as IT, payroll, HR, and marketing so that the entire organization now receives these services from
one place. As a result, we have cut management and general overhead expenses by nearly 50 percent in
the last eight years. This has permitted more donor dollars to go towards maintaining the level and
quality of service we provide to the public.

We also set about strengthening service delivery to the public. We re?engineered our disaster
services operations to provide a more standardized set of services delivered at the community level by
those closest to the people we serve. In the past, national headquarters in Washington, DC, ran our
responses to large disasters. But with critical input from our employees and volunteers in the field as
well as federal, state and local emergency managers we built a program where our front?line workers
now lead the response while national headquarters supports their work and mobilizes materials and staff
nationwide when required. Re?engineering was never intended as a headcount reduction exercise, but an
effort to continuOUSly improve our service delivery. The only headcount change reduced the number of
jobs reporting to national headquarters and increased the number of jobs reporting to our leadership in
the ?eld.

On the fundraising front, we also moved resources fr0m national headquarters to the ?eld. We
addressed our overreliance on funds raised during times of major disaster by working diligently to
become year?round fundraisers and engaging more people in our mission. As a result, putting aside
major disasters, which ?uctuate year to year, we have increased ?nancial donations from individual,
corporate and foundation donors by 14 percent since 2008. We also pioneered mobile giving in 2010,
launching Text REDCROSS to 90999 for a $10 donation. This new tool made charitable giving easier and
more accessible to the public, especially to the next generation of donors.

We also invested in marketing to refresh our 134-year-old brand and educate more people about
the work we do and the services we deliver to the public. We worked with outside ?rms that provided
services to us at deeply discounted rates or contributed their services pro bono. Annual marketing costs
since I arrived at Red Cross have never exceeded One percent of the entire Red Cross budget, a level that
we believe is lower than most national not?for?pro?ts. In addition, we have concentrated our marketing
expenses around key strategic initiatives that have improved client access to Red Cross services and
information while also increasing our operating ef?ciencies. One example of this is the revamping of our
website redcross.0rg to be more user?friendly and informative.

By streamlining our operations to reduce costs, and also bolstering our fundraising efforts, we
were able to eliminate our $209 million annual operating deficit within two years and achieve modest
surpluses or a balanced budget in three of the next four years By this point, we were
on the right path ?nancially, but there were new challenges looming ahead.

Turnaround 11

While the issues we dealt with in the first four years of my tenure were long?standing, a new,
unanticipated issue arose in 2012, and deepened in 2013. A significant decline in the demand for blood
products surprised the entire blood banking industry. This was caused by an increase in the number of
non-invasive surgeries and by hOSpitals adopting more judicious blood management policies. The drop in
demand led to rapidly declining revenues across the entire industry causing many blood bankers to
reduce size, consolidate, or even ?le for bankruptcy.

As the largest supplier of blood and blood products in the U.S., the Red Cross had no choice but to
restructure and right?size our biomedical operations to keep up with falling demand and price
competition. We had to achieve this without moving too quickly to a lower-cost operation and risking our
ability to provide quality, lifesaving blood products to patients. Although demand was decreasing, the fact
remains that every two seconds someone in the U.S. still needs blood.

These challenges forced us to reduce expenses once again, not only in our blood operations but
across the entire Red Cross, while still delivering the services necessary to perform our mission. We
began right?sizing our blood services to address falling demand while still providing 14,000 units of blood
every day to meet the continuing needs of hospitals and patients. We are also proud of the fact that the
changes we made did not affect the quality of our blood operations; in fact, our quality signi?cantly
improved. We were able to achieve the ?ve?year period of sustained compliance required by the Food and
Drug Administration (FDA) to be released from the FDA Consent Decree regarding our blood services.
We obtained that release in December 2015, a major accomplishment after 22 years under the Decree.

2

We also developed a plan to lower the cost of our chapter operations by ?nding more ef?cient
ways to work and expanding the role of volunteers. We consolidated a number of chapters and regions,
eliminating duplicative layers of management, but with the objective that such reductions would not
directly impact service delivery to the public. As chapters were consolidated, the merged chapter
continued to serve the entire area formerly covered by separate chapters. We took numerous steps to
ensure these initiatives did not hinder our ability to execute day?to?day disaster responsibilities. And we
worked to continue reducing overhead costs at national headquarters by further consolidating positions
and becoming leaner.

Many of these changes were dif?cult, especially when they eliminated the jobs of dedicated, hard?
working members of the Red Cross family. We sought to minimize layoffs by reducing costs in other
ways. We have been consolidating our ?eet and real estate, negotiating better prices with our vendors,
reducing travel and taking advantage of attrition.

Obviously, any organization going through changes of this nature will experience morale issues.
There will always be valued employees and volunteers who do not agree with the changes that are
required to deal with the ?nancial challenges we faced. We continue to deal with these issues through
improving two?way communication with our employees, working with them to develop a future vision for
the Red Cross that they can embrace and increasing training to develop our workers and our future
leaders. While we are always striving to improve, we are encouraged by the fact that 82 percent of our
employees say they are proud to work for the American Red Cross.

The best thing we can do for employee morale, of course, is ensure that the Red Cross is
?nancially stable. We are still in the middle of Turnaround II, but we are bringing our operating de?cit
down again. If our assumptions are correct regarding the demand for blood products, we anticipate
reaching a break even budget by June 30 of this year, the end of FY2016. That should benefit morale
considerably. .

Below is a chart with our operating budgets for the last eight ?scal years and the forecast for the
current ?scal year, FY2016.

FY 2008 FY 2016, American Red Cross Operating Margins and Forecasts

 

FY2008 FY2009 FY FY FY2012 FY FY2014 FY2015 FY
2010 2011 2013 2016*

 

 

 

 

 

 

 

 

 

 

 



 

*Forecast
Mission Delivery

Given the size of the deficit I inherited eight years ago, and the new ?nancial challenges posed by
the changing blood industry, we had no choice but to right?size the organization to become ?nancially
stable and continue our lifesaving mission. Dif?cult ?nancial decisions, including the separation of
valued employees, were made in order to ensure the Red Cross could sustain the level and quality of
services we provide to the public. I can assure you that these decisions were not taken by either our
Board of Governors, or by me. But our focus has always been on using donor dollars ef?ciently and
lowering the costs of delivering our services to the public without diminishing the services themselves 
and we believe we have achieved that goal. In fact, many of our services have actually increased and
improved.

During the last three years, we have increased the overall amount of financial assistance we
provide to victims of home ?res and other local disasters, as well as the number of cases served.

In addition, we launched a new program in October 2014 to help prevent deaths and property
damage from home fires, which cause more deaths and injuries every year than any other type of disaster.

In just over the year since launching the campaign, the Red Cross and our coalition partners have
installed approximately 239,000 smoke alarms in over 4,190 communities an average of one smoke
alarm every four minutes. In Mississippi alone, the Red Cross and our program partners have installed
more than 4,100 smoke alarms and have reached more than 3,800 young people with vital preparedness
lessons. I said the campaign would be a success if it saved just one life; we can already say the campaign
has lead directly to at least 48 lives saved to date.

We are also using new technology to reach more people than ever before with lifesaving
informati0n, including a series of 12 award?winning free apps which have been downloaded more than
seven million times and translated into 30 languages.

During my tenure, we have responded to two of the largest disasters in American Red Cross
history: the Haiti Earthquake of 2010 and Hurricane Sandy in 2012. The scope and scale of our reSponses
to these disasters has been massive.

In Haiti, Working with partners, we have provided a wide range of humanitarian assistance:

- Emergency shelter was provided by the global Red Cross network for approximately
860,000 people immediately after the earthquake;

0 Three million pre?packaged meals as well as $30 million in funding to help feed an
additional 1 million people for a month in the quake?s immediate aftermath;

- Funds to help build or operate or equip 22 hospitals and clinics;

- Help for more than 135,000 people through safe housing and neighborhood recovery;

0 Funding for Haiti?s ?rst lifesaving cholera vaccine campaign, which reached
approximately 90,000 people;

0 Access to clean water and sanitation including establishing more than 9,000 latrines and
other water and sanitation systems;

0 Loans, cash grants and job training to help more than 380,000 Haitians rebuild
livelihoods;

- Training more than 550,000 people to be better prepared for future disasters.

During Hurricane Sandy, 17,000 Red Cross workers nearly all of them volunteers served more
than 17.5 million meals and snacks, distributed seven million relief items and provided 74,000 overnight
stays in shelters. After the emergency relief phase, our Move?In Assistance program provided to
more than 5,100 households and we awarded to partners to help assist those in the community
with their long?term recovery.

By its nature, disaster relief is never completely without problems, and we learn lessons from
every disaster. We strive to be a learning organization that is always improving to serve our clients better.
While we do not get everything perfect every single time, no other organization can match the sheer
volume of aid and comfort that the Red Cross is able to deliver, on a consistent basis, year after year,
thanks to our donors and volunteers.

The American Red Cross is still responding every eight minutes to disasters, and we are needed
now more than ever. In 2015 alone, the Red Cross provided more than 34,000 overnight shelter stays,
served more than 1.1 million meals and snacks and responded to 176 large?scale disasters more large
disasters than have occurred in each of the previous three years.

And most notably, the last month?and?a-half have been extremely busy for the American Red
Cross, with as many as 2,600 Red Cross disaster workers responding to more than 340 emergencies since
mid?December or more than three times the number of disaster responses than for the same time in the
last three years. In your home state of Mississippi, one hundred Red Cross workers responded to the
December 23 North Mississippi tornado by opening three shelters, serving more than 3,700 meals and
snacks, distributing more than 1,300 relief supplies, and providing more than 700 health services and
mental health consultations to impacted individuals and families.

Mr. Ranking Member, as you said in your letter, you have a responsibility to ensure that federal
response and recovery partners are able to carry out their missions. Without the steps we have taken
during the last seven and a half years, I am not sure the Red Cross could have continued our mission. We
believe those steps reducing expenses, ensuring the organization?s ?nancial viability, strengthening
service delivery, maintaining service quality, and, overall, bringing this storied institution into the 21St
century were essential to our continued ability to serve the public. Because we took those actions and
kept a focus on our mission, we are exceptionally well?positioned to carry out our humanitarian work,
both today and in the future. And I can assure you we will do that effectively and compassionater going
forward.

Thank you. The answers to your Speci?c questions can be found below.

Sincerely,
Gail J. McGovern

President 8: CEO
American Red Cross

Management and Personnel at the Red Cross

The American Red Cross plays a critical role in serving our nation by caring for the public in
times of need. Our activities are funded almost entirely by private donations and carried out by a largely
volunteer workforce. When Gail McGovern joined the Red Cross in 2008, the organization faced a
number of serious ?nancial challenges that required her to streamline our operations and reduce
expenses while still maintaining the level and quality of the services on which the public depends. To do
this, we consolidated and centralized support services and back?of?ce functions such as IT, payroll, HR,
and marketing in order to reduce duplication and save money. We also reduced headcount in other
internal functions, such as administration and communications. We downsized headquarters to become
even leaner, and began consolidating our ?eet and real estate.

These and other changes, combined with our enhanced fundraising efforts, enabled us to eliminate a
$209 million annual operating deficit within two years and to achieve modest surpluses or a balanced
budget for three of the next four years. Just as we had turned this financial corner, however, an
unanticipated drop in demand for blood products across the entire industry forced us to reduce expenses
and headcount once again, not only in our blood operations, but across the entire Red Cross, including
our disaster services.

The 2013 disaster re?engineering effort was a separate and distinct effort to continuously improve our
service delivery during disasters; it was not an effort to reduce headcount. In the past, national
headquarters in Washington, D.C. ran our responses to large disasters. Disaster re?engineering was
designed to push more resources and decision?making out to the field and closer to front?line service
delivery and relief operations. The local ?eld organizations know their communities best and can ensure
that local needs are met. We created the ?division disaster staff? referenced in your question and gave
regions and divisions direct control over their disaster staff. The role of national headquarters changed to
assist the field leadership and mobilize materials and staff nationwide when required. The benefits of re?
engineering, including decision?making from the field, have made the disaster response structure less
centralized and permitted more flexible decision?making at the level closest to the action.

Like any organizational re?structuring, the disaster re?engineering effort involved doing away with some
jobs under the old structure and creating jobs under a new structure. These changes reduced the number
of jobs reportng to national headquarters while increasing the number of jobs reportng to our ?eld
leadership.

After disaster re?engineering was completed at the end of 2013, we needed to make headcount and
expense reductions across the entire Red Cross in order to respond to the falling demand for blood. While
the number of paid disaster staff has decreased in the last two years, our services, our volunteer hours and
the number of partners we work with have all increased. This has allowed us to maintain the ability to
execute our day~to~day disaster response capabilities.

In addition, we reduced the number of non?disaster projects and initiatives our chapter staffs were
involved with so they could focus more on responding to disasters. We developed tools to assist our
chapters in managing local partner relationships and provided additional training with regard to service
delivery at the local levels. And we formed a national team to support the disaster workforce and
strengthen the workforce readiness and capacity of both our volunteers and our employees.

Our goal has always been to cut the cost of delivering our services not the services themselves and we
believe we have successfully done this. In fact, during the last three years, we have actually increased the
overall amount of financial assistance we are providing to victims of home ?res and other local disasters,
as well as the number of cases served. We also launched a new program in October 2014 to help prevent
deaths and property damage from homes fires, which affect more people every year than any other type of
disaster. To date, we and our coalition partners have installed approximately 239,000 smoke alarms in
4,190 communities leading directly to at least 48 lives saved.

 To preserve our lifesaving mission in the face of ?nancial challenges, the Red Cross has gone
through two major turnarounds in the last eight years, each of which has required us to continuously
become more ef?cient in our staf?ng models while maintaining and improving the level and quality of
services we deliver to the public.

As part of these efforts, we develOped a plan to lower the cost of our chapter operations by consolidating
smaller chapters (in some cases one or two person chapters) with chapters representing larger geographic
territories. This allowed us to reduce duplicative layers of our internal management in order to serve
these communities in the most cost effective manner while still meeting each community?s needs. As our
chapters consolidated, the merged chapters continued to serve the entire area formerly covered by
separate, smaller chapters. Every geography in the US. is still covered by a chapter, with staff and/ or
volunteers active in more than 2,900 counties in the US. in FY2015.

As we consolidated our chapters, we took numerous steps to ensure we did not hinder our ability to
execute our day?to?day disaster responsibilities. The Red Cross field structure, which is highly mission?
focused, is signi?cantly expanding the role of volunteers and has increased our fundraising capabilities.
Our lower cost structure enables us to use more of the dollars entrusted to us on delivering services to

people.

Additionally, the Red Cross has invested nearly a million dollars in disaster training institutes and
exercises over the past several years in order to bring together our volunteers and our employees to better
prepare for and respond to disasters at the local level.

We also are using new technology to reach more people than ever before with lifesaving information,
including a series of 12 award-winning free apps which have been downloaded more than seven million
times and translated into 30 languages.

Any organization going through periods of significant change will experience morale issues.
There will always be valued employees and volunteers who do not agree with the changes that are
required to deal with the ?nancial challenges we have faced. We continue to deal with these issues
through improving two?way communication with our employees, working with them to develop a future
vision for the Red Cross that they can embrace, and increasing training to develop our workers and our
future leaders.

Our President CEO Gail McGovern, holds regular town hall meetings with all our staff. She routinely
recognizes employees throughout the organization who go above and beyond their required duties in
carrying out the Red Cross mission, and she encourages all staff and volunteers to contact her through a
variety of means.

Independent research shows that employee engagement is currently a problem for many large institutions
across the nation.1 While we are constantly striving to strengthen employee engagement, we are
encouraged by the fact that 82 percent of our employees say they are proud to work for the American Red
Cross.

The best thing we can do for employee morale is to ensure that the Red Cross is a financially sound
organization. As described in Gail McGovern?s letter above and in our responses to your earlier questions,
we have been taking all reasonable steps available to ensure that the Red Cross is ?nancially stable. We
are making progress on that front; our operating deficit continues to decline and, if our assumptions
regarding the demand for blood products are correct, we expect to achieve a break even budget by June
30 of this year, the end of FY2016. That should benefit morale considerably.

 

1 Amy Adkins, ?Majority of US. Employees Not Engaged Despite Gains in 2014,? Gallup (Jan. 28, 2015),
http: poll/ 181289 maj 14.aspx

7

 We have invested in marketing to refresh our 134?year?old brand and to educate more people about
the work we do and the services we deliver to the public. Funding for these initiatives comes out of our
annual operating budget and is not tied to a specific donation source.

The Red Cross has worked on these initiatives with outside ?rms that provided services to us at deeply
discounted rates or contributed their services pro bono. In fact, annual marketing costs have never
exceeded one percent of the entire Red Cross budget during Gail McGovern?s tenure. This is a level that
we believe is lower than most national not?for-pro?ts. In addition, our marketing expenses have

been concentrated around key strategic initiatives that have improved client access to Red Cross services
and information while also increasing our operating efficiencies. One example of this is the revamping of
our website redcrossorg to be more user-friendly and informative.

It is difficult for any organization to isolate the exact amount of funds raised as a result of marketing
initiatives. At the Red Cross, in addition to our marketing efforts, we have also strengthened our other
efforts to raise funds during Gail McGovern?s tenure. We have moved fundraising resources out of
national headquarters to the ?eld. We also have decreased our overreliance on funds raised during times
of disaster by working hard to train our chapters to become year?round fundraisers. And in 2010 we
pioneered mobile giving by launching Text REDCROSS to 90999 for a $10 donation. This new tool has
made charitable giving easier and more accessible to the general public, especially the next generation of
donors.

Although Red Cross donations often rise or fall depending on the severity and number of disasters in
a given year, if fundraising from major disasters is excluded, we have increased financial donations from
individual, corporate and foundation donors by 14 percent since 2008.

(5) The Red Cross has nearly 330,000 volunteers in more than 2,900 counties in the U.S., and we are
committed to the mobilization and management of our volunteer resources to provide even more services

to the public.

The changes that we made to reduce our expenses and real estate have not decreased our local presence.
In fact, we have taken a number of steps to increase our local presence. Our Home Fire campaign,
launched in October 2014, has not only resulted in lives saved, it has allowed us to engage with more than
2,300 partner organizations, including over 700 new partners. These relationships are designed to
strengthen the community networks that are necessary to support disaster response and recovery.

Our disaster re?engineering efforts, mentioned in Answer 1 above, have helped us build a program that
puts ?eld leadership in charge of disasters and places more emphasis on developing local community
resources and volunteers and strengthening relationships with local stakeholders.

Most importantly, the Red Cross has taken a number of steps in recent years to mobilize and manage
volunteer resources to expand our presence, services and capabilities in communities. In 2012, we
implemented a new online volunteer management system called Volunteer Connection to make it easier
to match volunteer interests with the type of obs we need to perform our services. We have increased our
focus on practices to help volunteers feel more satisfied with their work. This includes setting regular
meeting times (in person, by phone, or using Skype) to check in with volunteers on their work, express
appreciation, review results and next steps. We also encourage regular communications from local senior
leadership about what is happening in our organization and the important role volunteers play in the

organization?s progress.

We have also introduced a new role called the Community Volunteer Leader for individuals who are
willing to take a leadership position with respect to Red Cross activities involving their communities. We
are educating and engaging volunteer leaders in this new role across the country. This is a specialized role
intended for individuals with knowledge and in?uence in their communities.

Volunteers have always been the back bone of the American Red Cross and we are enhancing their roles in
helping us meet the needs of the public. In recent years, volunteers have been active with the Red Cross

8

in a number of new and innovative ways including digital volunteers who are active on social media,
volunteers who assist international relief efforts through the use of remote mapping technology, volunteer
trainers who are now leading some of our health and safety courses, and volunteer blood ambassadors
who help to make donating blood a more ef?cient and enjoyable experience for our sel?ess blood donors.

Red Cross and Domestic Disasters

The Red Cross is regularly engaged with hundreds of state and local emergency management
organizations to ensure a coordinated and effective response during times of disaster. We are keenly
sensitive to our relationship with our government partners. We value and appreciate these relationships
and work hard to maintain and enhance our joint efforts. We consider ourselves a part of every local and
state emergency plan because we have coverage in every US. community.

The Red Cross is structured through our division, region and chapter organizations to work side?by?side
with our local and state partners, and to have ongoing discussions that lead to shared understandings of
expectations for Red Cross services. We have similar relationships between our national headquarters
staff and our national partners like FEMA.

As part of disaster re-engineering changes in the Red Cross ?eld structure and because of the pace of
operations in recent years, the Red Cross has redoubled its efforts to ensure that ?eld and headquarters
leaders and managers remain actively engaged in these relationships. For example, as part of the new
disaster field positions created through re?engineering, the Red Cross created 17 new Division Disasters
State Relations Director positions to give speci?c attention to relationships with state emergency
managers. We also increased our engagement with National Voluntary Organizations Active in Disasters
(V OAD), and elevated our relationship with the Big City Emergency Managers Network with more
frequent and focused discussion.

(7) In 2015 alone, the American Red Cross provided more than 34,000 overnight shelter stays, served
more than 1.1 million meals and snacks and responded to 176 large-scale disasters which is more large
disasters than have occurred in each of the previous three years.

By its nature, disaster relief is never completely without problems, and we learn lessons from every
disaster. We strive to be a learning organization that is always improving to servethe public better.
While we do not get everything perfect every single time, no other organization can match the sheer
volume of aid and comfort that the Red Cross is able to deliver on a consistent basis, year after year,
thanks to our donors and volunteers.

The West Virginia operation was not given federal disaster status, and did not reach the size and scale
to be categorized as a major disaster. Accordingly, the Red Cross did not initiate an after action
assessment, instead we chose to focus our staff on their continuing engagement with state and county
of?cials and local partners to improve planning and service delivery.

The Red Cross has not yet completed an after action assessment for the Northern California response.
We are, however, moving forward with performance improvements identified throughout our Northern
California response. In addition, Red Cross division, region and national headquarters disaster leadership
are engaged in a range of discussions with the California Of?ce of Emergency Management and with local
government and service delivery partners as follow?up to our Northern California operations.

As mentioned in answer 7 (above), the Red Cross learns from every disaster. Based on our
experiences and observations from previous disasters, we took the following steps in South Carolina to
strengthen our response:

a We engaged the local community to plan and execute a response strategy that included the
use of event?based volunteers, who volunteer for the ?rst time when an event happens, as a
critical workforce component.

0 We established an Assistant Director for Recovery Services early in the South Carolina
operation to ensure a smooth and effective ramp up of recovery services.

a We partnered with Portlight Strategies and Able South Carolina to provide Red Cross
volunteers and employees with just?in time training for providing exceptional service to
disaster victims with access and functional needs, including those with disabilities.

The Red Cross took action during the South Carolina ?oods, as we do during other disasters, to ensure
we were collaborating with numerous diverse organizations to reach impacted communities. We worked
with more than 20 diverse organizations during the response and recovery efforts. In some cases, the Red
Cross identi?ed new local organizations and, of course, we continued to work with existing local and
national partners representing individuals from the African American, Latino, Native American, faith-
based and disability communities.

We worked with our partners to operate Multi?Agency Resource Centers (MARCs), where disaster victims
could receive help from a number of different agencies in one location. We also worked with partners to
identify impacted individuals unknown to the Red Cross, identify unmet needs and corrective actions,
train Red Cross volunteers, coordinate resources, and share operational data used to enhance our
awareness of situations arising from the disaster.

Examples of organizations we worked with include:
- NAACP, local and national.
National Baptist Convention USA, local and national.
National Action Network.
Lott Carey.
National Council of La Raza, local and national.
Islamic Relief USA.
Islamic Circle of North America (IONA).
Portlight Strategies Inc.
Centers for Independent Living, local and national.
Salvation Army.
Catholic Charities.
South Carolina Voluntary Organizations Active in Disaster (V DAB).

(0) In South Carolina, we responded to the historic ?ooding through support to the local community, as
well as assistance to individuals and families. In impacted communities, we opened shelters, provided
food and ?ood relief supplies, and we coordinated with our partners to ensure all emergency needs were
met. In addition, we helped 5,450 individuals and families meet their immediate emergency needs,
providing many with ?nancial assistance while helping others to obtain services from federal and state
agencies and partners.

The Red Cross has plans to provide additional financial assistance to people who need extra help
recovering, including aid to renters and homeowners who were impacted by the destruction of affordable
housing stock in many areas throughout the state and who have unmet disaster?caused needs. In
addition, the Red Cross will partner with local agencies to address mold remediation, disaster-caused
community health concerns and reach underserved populations through a grants program.

(9) The Red Cross's coordination with FEMA and other federal agencies is extensive and effective with
respect to disaster response and, of special note, with respect to recovery as well. A Memorandum of
Agreement with FEMA that went into effect on July 28, 2015, elaborates in Section IV .A.5 on how the Red
Cross and FEMA coordinate in a disaster's recovery phase.

10

 Please ?nd attached our Recovery Framework and our Recovery Program Essentials, both of
which were published on our internal website and made available to all Red Cross staff in 2014, and both
of which were products of our disaster re?engineering efforts. Their objective is to bring about
consistency in our recovery services so that disaster victims in similar circumstances receive similar
services across the nation. With these as foundation documents, the Red Cross is developing systems and
tools to be used by our ?eld disaster workers to guide activities. The Recovery program has been in effect
for all disaster relief Operations since 2014.

The Recovery Framework is supported by training materials and is disseminated throughout our division,
region and chapter structure. All recovery guidance is published on the Red Cross intranet and is
available to all volunteers and employees at any time. This guidance has speci?cally been used to create
four courses to allow our volunteers and employees to further build On their knowledge and ability to
execute these services. Our intent is to clearly de?ne and communicate the process of service delivery for
our mostly volunteer workforce.

The Red Cross has embraced the Incident Command System structure to manage operations at the
disaster level. In that structure there is a single Assistant Director of Operations and a Recovery Manager.
These individuals are charged with administering the recovery program, and their roles are designed to
align with state and local partners to better coordinate service delivery.

During the Northern California Wild?res response, and in the longer recovery period that has
followed, delivery of recovery services has continued to be managed consistent with program guidance.
The Red Cross provided funds in the form of direct ?nancial assistance and provided people with referrals
to the services and sources of additional funding that could be made available by partners in service
delivery.

In the Emergency Relief phase of the disaster, we responded to the wild?res through support to the local
community, as well as assistance to individuals and families. In the impacted communities, we opened
shelters, provided food and clean?up supplies, and we coordinated with our partners to ensure all
emergency needs were met. In addition, we helped 3,424 individuals and families meet their immediate
emergency needs, providing many with ?nancial assistance while helping others to obtain services from
federal and state agencies and partners.

The Red Cross will continue to work with survivors to meet their long?term recovery needs, which include
reconstruction, transitional housing transportation, permitting and fees, and disaster caused health
issues.

The Red Cross has been a contributing partner in the establishment of the Lake County Long-Term
Recovery Committees (LTRC). Red Cross is actively engaged with two LTRC groups working together
within the Valley fire recovery: the Lake County Recovery Task Force and Team Lake County. Recovery
efforts include supportng case management training facilitated by a committee partner, United
Methodist Committee on Relief (UMCOR).

The Red Cross also has been a contributing partner in establishing the Calaveras County LTRC. Red
Cross is actively engaged with two LTRC groups working together within the Butte Fire Recovery: The
Calaveras County Recovery Task Force and Calaveras Recovers.

Red Cross and International Disasters

10) The American Red Cross has over 100 years of experience responding to international disasters and it
responds to approximately 20 international disasters each year. In addition, through the generous
support of our d0nors, the American Red Cross has signi?cant experience with multiyear recovery
programs in developing countries as is the case with Nepal. In fact, in just the last 15 years, the American
Red Cross has launched and successfully executed disaster recovery programs in India, Sri Lanka,
Indonesia, the Maldives, Peru, Chile, Haiti, the Philippines and, most recently, Nepal.

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In Haiti, the Red Cross made a positive difference in the lives of millions of Haitians who desperately
needed help and humanitarian assistance. Through the generous support of our donors, we were able to
build, operate or equip 22 hospitals and clinics; help stem a deadly cholera outbreak; provide clean water
and sanitation; and provide help for more than 135,000 people through safe housing and neighborhood
recovery. We also built and repaired schools, roadways and water distribution points vital to
neighborhoods.

Following the earthquake in Nepal, the American Red Cross response has included the provision of
relief items such as food and blankets, unrestricted cash grants, and the deployment of disaster specialists
to provide assistance; funding, materials and expertise to help affected families repair or rebuild safer
homes; repair and construction of water and sanitation infrastructure in schools, as well as working with
communities to support basic hygiene, health and first aid activities; and disaster and evacuation
planning with improved maps and early warning capabilities as well as identifying and mitigating
potential hazards.

As of January 7, 2016, the American Red Cross had received $41,117,863 in funds designated for
Nepal. As of January 11, 2016, the Red Cross has spent or committed $39,113,878, which constitutes
more than 95 percent of the funds received for Nepal.

Delivering relief to earthquake~affected families in both Nepal and Haiti presented similar challenges,
including limited points of entry into the quake affected regions, impassable roads that made
transportation of relief supplies dif?cult; infrastructure that was fragile before the earthquakes and
further weakened by the quakes; signi?cant damage to the capitals of both countries impacting their
governments? ability to respond; and both countries experienced secondary emergencies.

Despite these hurdles?and many more?the American Red Cross delivered lifesaving supplies and
services to people in need. In both countries, we have stayed on past the emergency phase to help
residents rebuild in a way that helps them become safer, healthier, and more resilient to future disasters.
The example of Haiti?s recovery and the progress that has been made six years later is instructive. Despite
vast differences in geography, social and political context, and scales of disaster, our experiences in Haiti
hold several valuable lessons for relief and recovery in Nepal that include the following:

It is important to be respectful of the views of people in the impacted communities~and to
incorporate their priorities into recovery plans from the very beginning.

The American Red Cross continues to work alongside community members and the Haitian government
to set priorities for long-term recovery in collaboration with residents of the neighborhoods in which we
work. One example of working with the community in Haiti is a project called LAMIKA, which is bringing
a broad range of assistance to approximately 48,000 people in eight neighborhoods in 
When we first started working in this area, we set up eight community groups who identified their
neighborhoods? most pressing needs and participated in the program design process. The community
groups helped choose priorities for our projects and provided oversight. The American Red Cross
continues to meet with these community groups and their leaders regularly to gain feedback and
reprioritize as necessary.

Likewise, our recovery projects in Nepal are also community?led. The priorities and activities are being
set by residents themselves?ensuring that American Red Cross?s contributions are effective and
community members continue to have a vested interest in their sustainability.

People want to remain in the neighborhoods where their family, friends and jobs were before
the earthquake.

New housing sites, that were built by other organizations and located outside of Port?au?Prince, Haiti,
often remained unoccupied because people strongly prefer to remain in the neighborhood they lived in
before the quake?near their jobs, schools, businesses, and family. In Nepal?where families often live in
the same village for generations?the desire to stay in the same location, post?earthquake, remains.

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Helping residents rebuild homes and renovate neighborhood infrastructure to better withstand future
natural disasters is often more important to them than building brand new homes and/ or communities.

3* While the Red Cross unde rstands?and shares?the desire to spend donations quickly, the fact is
that spending decisions made hastily following a disaster may not serve the needs of survivors.

We know from decades of experience that What takes seconds to destroy often takes years to rebuild.
Done properly, recovery work is hard?and it takes time. In order to make countries? recovery from
disasters meaningful and sustainable, investments need to be made past the emergency phase. This often
includes activities that can take years, such as helping to re?establish livelihoods, building community
water systems, restoring medical capacity, and helping people obtain long?lasting shelter solutions such
as disaster-resistant houses. In the interim, people need assistance to help them bridge the gap, such as
temporary shelter and warm clothing. In addition, setting aside some donations to address secondary
emergencies?such as the cholera outbreak in Haiti and the 7.3 magnitude aftershock in Nepal?is also

critical.

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