Homeland Security: 9/11 Victim Relief Funds

Homeland Security: 9/11 Victim Relief Funds

Order Code RL31716
CRS Report for Congress
Received through the CRS Web
Homeland Security: 9/11 Victim Relief Funds
Updated October 4, 2006
Celinda Franco
Specialist in Social Legislation
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress

Homeland Security: 9/11 Victim Relief Funds
Summary
In the first days following the terrorist attacks of September 11, 2001, an
unprecedented number of Americans contributed more than $2.7 billion in donations
to assist in the relief of victims. According to a 2004 Rand Corporation study, that
money amounted to only a modest share (7%) of the $38.1 billion “quantified
benefits” provided to victims of the terrorist attacks. The Rand study reported that
payments worth $19.6 billion (51%) were disbursed by insurers and $15.8 billion
(42%) were disbursed by government programs.
The federal government responded to the attacks in various ways. In the first
week after the disaster, Congress passed the 2001 Emergency Supplemental
Appropriations Act for Recovery from and Response to Terrorist Attacks on the
United States (P.L. 107-38), part of which provided at least $20 billion for disaster
recovery in New York, Virginia, and Pennsylvania. Twelve days after the attack, the
September 11th Victim Compensation Fund of 2001 (P.L. 107-42) became law. This
program was intended to compensate any individual (or the personal representative
of a deceased individual) who was physically injured or killed as a result of the
attack. The deadline for filing a claim was December 22, 2003. By that date, nearly
97% of eligible victims or their families had filed injury or death claims. On June 15,
2004, Special Master Kenneth R. Feinberg and his staff completed the processing and
award determinations for all claims filed with the program. The overall payout of the
compensation fund was more than $7 billion. Congress also passed, and the
President signed into law, the Victims of Terrorism Tax Relief Act of 2001 (P.L.107-
134). Among other things, this law stated that victims would not be subject to
federal income taxes for the year in which they died and also for the previous year.
This law also exempted from gross income amounts received from the Victim
Compensation Fund.
In response to the terrorist attacks, the American public donated unprecedented
amounts of money to charities nationwide. Questions were raised about where the
money was going and whether the victims and their families had access to the
donated money in a timely manner. To help assure victims and donors that the
money was getting to the intended beneficiaries promptly, hearings were held in the
U.S. House of Representatives on November 6 and 8, 2001. New York Attorney
General Eliot Spitzer testified, as did representatives of the Better Business Bureau
Wise Giving Alliance, among others.
This report discusses the federal and private sector responses to 9/11. It also
provides background information on the amounts of money collected and distributed
by some of the larger victim relief funds such as the New York State’s World Trade
Center Relief Fund Distribution, the Twin Towers Fund, the Red Cross Liberty
Disaster Relief Fund and several Firefighters and Police Relief Funds. This report
will be updated as warranted.

Contents
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Federal Response to 9/11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The 2001 Emergency Supplemental Appropriations Act for Recovery
from and Response to Terrorist Attacks on the United States . . . . 1
September 11th Victim Compensation Fund of 2001 . . . . . . . . . . . . . . . 2
Victims of Terrorism Tax Relief Act of 2001 . . . . . . . . . . . . . . . . . . . . 4
Bills Introduced in the 109th Congress . . . . . . . . . . . . . . . . . . . . . . . . . 5
Existing Federal Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Victims of Crime Act of 1984 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Federal Emergency Management Agency . . . . . . . . . . . . . . . . . . . . . . . 7
Private Sector Response to 9/11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Congressional Oversight Hearings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Background on Selected Victim Relief Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
New York State’s World Trade Center Relief Fund Distribution . . . . . . . . 13
Twin Towers Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Liberty Disaster Relief Fund (Red Cross) . . . . . . . . . . . . . . . . . . . . . . . . . . 14
September 11 Fund (United Way) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
International Association of Fire Fighters — New York Firefighters
9-11 Disaster Relief Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Safe Horizons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Families of Freedom Scholarship Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Uniformed Firefighters Association Widows and Children’s Fund . . . . . . 16
The New York Police & Fire Widows’ & Children’s Benefit Fund . . . . . . 16
List of Tables
Table 1. General Award Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Table 2. Range of Award Values for Claims Relating to Deceased Victims . . . . 4

Homeland Security:
9/11 Victim Relief Funds
Background1
In the first days following the terrorist attacks of September 11, 2001, both the
federal government and the private sector responded in dramatic ways. The 2001
Emergency Supplemental Appropriations Act for Recovery from and Response to
Terrorist Attacks on the United States (P.L. 107-38) was signed into law seven days
after the attack. It provided at least $20 billion for disaster recovery activities and
assistance related to the terrorist acts in New York, Virginia, and Pennsylvania. The
September 11th Victim Compensation Fund of 2001 (a program that cost more than
$7 billion) was signed into law (P.L. 107-42) just 12 days after the attack. According
to a 2004 study by the Rand Corporation, of the $38.1 billion in “quantified benefits”
provided to victims of the terrorists attacks, $19.6 billion (51%) was disbursed by
insurers, $15.8 billion (42%) was disbursed by government programs and $2.7 billion
(7%) was donated by an unprecedented number of Americans to a wide variety of
charitable organizations.2 Some of the funds contributed to charities were managed
by well-established organizations with years of experience, but, according to the New
York State Attorney Generals’ office, more than 250 new charitable funds were
created specifically to meet the 9/11 crisis.
Federal Response to 9/11
Legislation
The 2001 Emergency Supplemental Appropriations Act for
Recovery from and Response to Terrorist Attacks on the United States.3
Seven days after the attack, this supplemental appropriations was passed for
emergency expenses to respond to the terrorist attacks by enhancing federal, state,
and local preparedness for mitigating and responding to the attacks; to provide
support to counter, investigate, or prosecute domestic or international terrorism; and
to generally support national security in all its aspects. The law provided that not less
than one-half of the $40 billion available must be used for disaster recovery activities
1 This report was originally authored by M. Ann Wolfe.
2 Lloyd Dixon and Rachel Kaganoff Stern, “Compensation for Losses from the 9/11
Attacks,” Rand Institute for Civil Justice (Rand Corporation, 2004), p. xviii.
3 P.L. 107-38.

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and assistance related to the 9/11 terrorist acts in New York, Virginia, and
Pennsylvania.
September 11th Victim Compensation Fund of 2001.4 Just 12 days
after terrorists hijacked passenger planes and flew them into the World Trade Center
and the Pentagon (a fourth plane crashed in Shanksville, Pennsylvania), the U.S.
Congress enacted the September 11th Victim Compensation Fund of 2001. This $7
billion program was intended to compensate any individual (or the personal
representative of a deceased individual) who was physically injured or killed as a
result of the terrorist attacks on September 11, 2001. Before receiving compensation,
Congress required that each claimant waive the right to file a civil lawsuit against the
airlines or other entities over their losses. However, fund claimants could sue to
recover collateral source obligations (e.g., money owed by insurance companies), and
they could file a civil action against terrorists who could have borne some
responsibility for injuries suffered in the attacks.
On November 26, 2001, Attorney General Ashcroft appointed Kenneth R.
Feinberg as special master to distribute the fund that Congress created without any
financial cap. The special master developed and promulgated regulations governing
the administration of the fund.5 The deadline for filing a claim was December 22,
2003. By that date, 97% of those eligible filed injury or death claims. On June 15,
2004, Feinberg and his staff completed the processing and award determinations of
all claims filed with the program. Of the 2,973 eligible families of dead victims,
2,880 filed claims. The average award for families of victims killed in the attacks
exceeded $2 million. Seventy people chose to file law suits naming airlines and
government agencies and thereby rejected the federal government’s offer of millions
of dollars in compensation. Twenty-three eligible families of dead victims took no
action. These families are no longer eligible to receive compensation from the fund.
In addition, 2,680 valid injury claims were filed and processed. The average award
for injured victims was nearly $400,000. The overall payout of the program was
more than $7 billion.6 Trial Lawyers Care,7 a group of more than 1,500 attorneys,
volunteered to aid the victims’ families free of charge.
Congress mandated that awards be offset by life insurance and other collateral
source compensation. In the regulations the special master defined ‘collateral
sources’ as not including tax benefits received from the federal government as a
result of the Victims of Terrorism Tax Relief Act, and stated that, in determining the
amount of offsets for pension funds, life insurance, and similar collateral sources, he
would reduce the amount of offsets to take account of self-contributions made or
premiums paid by the victim. The time period for seeking medical help was also
4 P.L. 107-42 was amended by P.L. 107-71 and P.L. 107-296 and codified at 49 U.S.C.
§40101 note. See CRS Report RL31179, The September 11th Victim Compensation Fund
of 2001, by Henry Cohen.
5 67 Federal Register 11233 (2002) (to be codified at 28 CFR Part 104).
6 Information received from Ms. Camille Biros from the Office of the Special Master.
7 See [http://www.911lawhelp.org], accessed Aug. 30, 2006.

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extended from 24 hours to 72 hours after the event, with discretion to extend the time
period even further on a case-by-case basis for rescue personnel.
In a Congressional Quarterly article it was reported that “...despite the funds
apparent success, some legislators, families of the victims and even the special
master himself say funds like that set up for the victims of September 11 might not
be the best approach for responding to future large-scale terrorist attacks.”8
Feinberg said “I’m dubious that Congress will do this again...it was successful, but
it was in response, I think, to a very unique historical event.... I think the reason is
9/11 left a scar on the American people....[H]esitancy to become an automatic insurer
for airlines or any other industry...will likely have Congress thinking twice before
endorsing the Sept. 11 fund as a model for the future.” Some people thought that the
special master had too much power in distributing the fund. Some thought that the
fund was unfair because victims’ life insurance policies had to be taken out against
the total award a family received and thereby rewarded families without insurance
for “poor family planning.” Feinberg thought that if Congress does anything next
time, it will likely be everyone receiving the same amount instead of asking a special
master to try to determine how much money a victim would likely be earning over
a lifetime.9
In a final report of the September 11th Victim Compensation Fund of 2001,
Feinberg addressed several important questions. He indicated that the fund was
sound public policy because it constituted a legitimate response by the nation to a
unique historical event. He did not think that the fund was a useful precedent for the
future because the profound conditions that existed immediately after the attacks will
probably not be duplicated. He suggested that, in the future a better approach might
be to provide the same amount for all eligible claimants and that this approach should
probably not be part and parcel of restrictions imposed on the right to litigate in
court.10
8 Caitlin Harrington, “9/11 Victims Fund May Be a Unique Effort, Its Steward Says, That
Will Never Be Tried Again,” CQ Homeland Security, July 15, 2004.
9 Ibid.
10 U.S. Department of Justice, Final Report of the Special Master for the September 11th
Victim Compensation Fund of 2001, Volume I, Kenneth R. Finberg, Esq., Special Master.

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Table 1. General Award Statistics
( last updated November 1, 2004)
Claims Submitted (combined injury and death claims)
7,403
Claims Resolved by the Office of the Special Master (combined
7,402
injury and death claims)
Number of Award Letters Issued (combined injury and death claims)
5,559a
Other Claims Resolved by the Office of Special Master
1,843b
Average Deceased Victims Awards After Offsets
$2,082,035
Median Deceased Victims Award After Offsets
$1,677,633
Source: Final Report of the Special Master For the September 11th Victim Compensation Fund of
2001, Volume II, Table 1, p. 324, available at [http://www.usdoj.gov/final_report_vol2.pdf].
a. Claimants have 21 days to respond to award letters.
b. Includes inactive, denied, denied on-appeal, and voluntarily withdrawn claims.
Table 2. Range of Award Values for Claims
Relating to Deceased Victims
(Award Ranges Stated Are After Collateral Offsets)
Income level
Age
Range
$50,000 or less
35 or Under
$250,000 to $3.2 million
$50,000 or less
Over 35
$250,000 to $4.1 million
$50,000 to $100,000
35 or Under
$250,000 to $4.2 million
$50,000 to $100,000
Over 35
$250,000 to $4.3 million
$100,000 to $200,000
All Ages
$250,000 to $5.5 million
Over $200,000
All Ages
$250,000 to $7.1 million
Source: Final Report of the Special Master For the September 11th Victim Compensation Fund of
2001, Volume II, Table 1, p. 325, available at [http://www.usdoj.gov/final_report_vol2.pdf].
Victims of Terrorism Tax Relief Act of 2001. 11 On January 23, 2002, the
President signed into law the Victims of Terrorism Tax Relief Act of 2001. Among
other things, the law specifically exempted from gross income (for tax purposes)
amounts received as payments from the September 11 Victim Compensation Fund
(those who died from anthrax and victims of the Oklahoma City bombings are
included in these exemptions). The law states that, “victims will not be subject to
federal income taxes with respect to the taxable year in which they died (2001 or
1995) and also with respect to the previous year ... Certain death benefits paid by an
employer to a victim of terrorism are excluded from gross income ... Estate taxes are
reduced for terrorism victims (and for certain members of the Armed Forces) but they
11 P.L. 107-134, codified at 26 U.S.C. 1 note.

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are not eliminated...Disability payments made to injured terrorist victims are
excluded from gross income ....”12
Bills Introduced in the 109th Congress. During the 109th Congress, a
number of bills have been introduced related to the September 11th Victim
Compensation Fund or other benefits for individuals or families affected by the
terrorist attack. The following bills were introduced but have not received final
action.13
S. 224 and H.R. 477, introduced by Senator Kennedy and Representative
Markey, respectively, on February 1, 2005, would extend the period of COBRA
health insurance coverage continuation for victims of the terrorist attacks of
September 11, 2001.
H.R. 565, introduced by Representative Maloney on February 2, 2005, would
extend the time for filing certain claims under the September 11th Victim
Compensation Fund of 2001.
H.R. 715, introduced by Representative McHugh on February 9, 2005, would
extend the time for filing claims for the September 11th Victim Compensation Fund
of 2001 from two years to four years.
H.R. 3575, introduced by Representative Maloney on July 28, 2005, and S.
1620, introduced by Senator Reid on September 7, 2005, would provide
nonimmigrant spouses and children of nonimmigrant aliens who perished in the
September 11th terrorist attacks an opportunity to become lawfully admitted
permanent residents. The bills would also provide for the cancellation of removal
proceedings for certain these nonimmigrant spouses and children of nonimmigrant
aliens victims of the terrorist attacks under certain conditions.
Existing Federal Programs14
Victims of Crime Act of 1984.15 The Victims of Crime Act of 1984
(VOCA) established the Crime Victims Fund (CVF) within the Department of
Justice. The fund is the sole source of resources for the VOCA-authorized programs
and is composed of particular fines, penalties and special assessments imposed on
convicted federal defendants and gifts, bequests, and donations. In recent years, a
cap has been placed on deposits to the CVF. In FY2003, the fund was capped at
12 Trial Lawyers Care [http://www.911lawhelp.org/info/news/VTRact.htm], accessed on
August 30, 2006.
13 A number of bills were introduced during the 108th Congress related to the September 11,
2001 Victims Compensation Fund or related matters, including S. 549, S. 684, H.R. 401, S.
1275, S. 1728, S. 1740, H.R. 602, and H.R. 2878.
14 The Catalog of Federal Domestic Assistance staff has identified over forty federal
programs that could have been of special interest to those seeking assistance in dealing with
the events of 9/11. See [http://www.cfda.gov/911.htm] for a list of the programs.
15 P.L. 98-473, codified at 42 U.S.C. 10601 et seq.

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$621 million (after the required government-wide recession reduced the cap from
$625 million); in FY2004, a cap was placed at $621.3 million (after the required
government-wide recession reduced the cap from $625 million). For FY2005 and
FY2006, the fund was also capped at $625 million prior to rescissions.
The CVF is managed by the Office of Victims of Crime (OVC). After 9/11, the
Terrorism and International Victims Unit (TIVU) was established to coordinate OVC
resources and funding for victims of terrorism. OVC received an additional $68.1
million in the FY2002 Department of Defense Appropriations Act to assist the
victims of 9/11.16 OVC makes Antiterrorism and Emergency Assistance funding
available to support five types of assistance in the wake of an act of terrorism or mass
violence as follows:17
! Crisis Response Grants (available within 0-9 months). Help rebuild
adaptive capacities, decrease the sources of stress, and reduce
symptoms of trauma;
! Consequence Management Grants (available within 9-18 months).
Help victims to adapt and restore a sense of equilibrium;
! Criminal Justice Support Grants (available within 18-36 months).
Facilitates victims’ participation in investigations and prosecutions
related to terrorism;
! Crime Victim Compensation Grants. Reimburses victims for out-of-
pocket expenses related to terrorism. Funds cannot be used to cover
property damage or loss; and
! Training and Technical Assistance. Assist in identifying resources,
assessing needs, coordinating services and developing strategies for
responding to an act of terrorism.
OVC funding may support, among other things, the following activities: crisis
counseling, needs assessments and planning, outreach plan development, emergency
transportation and travel, temporary housing assistance, emergency food and
clothing, victim information websites, vocational rehabilitation and compensation for
medical and mental health costs, lost wages, and funeral expenses.
Prior to the September 11, 2001 attack, the OVC funded victim assistance
services for five separate terrorist attacks: the Pan Am Flight 103 bombing over
Lockerbie, Scotland (1988); the Alfred P. Murrah Federal Building bombing in
Oklahoma City (1995); the Khobar Towers bombing in Dhahran, Saudi Arabia
(1996); the U.S. Embassy bombings in East Africa (1998); and the USS Cole
bombing in the port of Aden, Yemen (2000).18
16 P.L. 107-117, 115 Stat. 2294.
17 U.S. Department of Justice, Office for Victims of Crime, Meeting the Needs of the Victims
of the September 11th Terrorist Attacks: Department of Defense Appropriations Act of 2002,
report to Congress, April 2003, pp.6-7.
18 Ibid., p. 4.

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On April 23, 2002, the Justice Department announced that it had awarded a total
of $42 million to California, Massachusetts, New Jersey, New York, Pennsylvania,
and Virginia to provide mental health counseling for victims of the September 11
terrorist attacks, their families, and crisis responders who helped victims of the
attacks. These grants include funds to compensate victims for counseling services
and to support state and local programs that offer various forms of counseling. In the
fall of 2001, OVC had also provided more than $16 million to provide immediate
support to New York, Pennsylvania, and Virginia to help victims of the September
11 attack and their families. In addition, more than $6 million in grants was awarded
to New Jersey and California for victim compensation.19
Federal Emergency Management Agency. The Federal Emergency
Management Agency (FEMA) provides a range of assistance to victims of major
disasters or emergencies after the President issues a declaration. At the time of the
9/11 attack, cash grants of up to $14,800 could have been provided to victims
deemed to be eligible for assistance from the Individual and Family Grant (IFG)
program authorized by the Robert T. Stafford Disaster Relief and Emergency
Assistance Act, as amended.20 Because the 9/11 attack was considered a criminal act,
however, benefits under the IFG program were not provided to victims as the
resources of the crime victims compensation funds were determined to be more
appropriate and beneficial.21
Private Sector Response to 9/11
As previously stated, a study published by the Rand Corporation reported that
$19.6 billion, 51% of the $38.1 billion worth of “quantified benefits” provided to
victims of the 9/11 attacks, was disbursed by insurers. According to the study,
“[m]ore than 85% of insurance payments went to businesses. Those who were killed
or seriously injured received most of the remainder, with a small percentage going
to those with residential property damage. Even in the first two groups, however,
insurance payments were often modest compared with losses. Individuals usually
carried small amounts of life insurance relative to their annual earnings. Many small
businesses had very limited or no business-interruption insurance.”22 The Rand study
estimated that $1 billion of overall worker’s compensation payments were made
toward death and serious injury claims. This rough estimate was determined by
multiplying 2,500 (the number that represents death or serious injury claims filed in
19 Ibid., pp. 13-14.
20 42 U.S.C. 5178 (repealed). The Disaster Mitigation Act of 2000 (P.L. 106-390) repealed
the authority for the IFG program and authorized a new program, Federal Assistance to
Individuals and Households (42 U.S.C. 5174) effective Oct. 1, 2001. As the 9/11 attack
occurred prior to the effective date of the new provision, victims of the attack would have
been eligible for IFG assistance. Regulations for the new program are found at 67 FR
61445-61460.
21 Ms. Donna Dannels, Deputy Director, Response and Recovery Directorate, private
interview held with Keith Bea of CRS during briefing on the attack, Sept. 2001.
22 Dixon and Stern, p. xx.

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New York and other states) by $400,000 (the expected lifetime payout on a New
York workers’ compensation death claim).23
It has been estimated that $2.7 billion was donated by the American people in
the early days after the 9/11 attack. Some of the well-established charities such as
the United Way and the New York Community Trust, the American Red Cross and
the Robin Hood Foundation of New York City (NYC) set up special funds for the
victims. For example, the September 11th Fund was set up by the United Way and
raised up to $510 million; the Liberty Disaster Relief Fund set up by the American
Red Cross became the conduit for $1 billion to aid those affected by the attacks; the
Robin Hood Foundation set up by the Robin Hood Relief Fund raised $59.6 million
to benefit victims’ families, the rescue workers, and others who have been affected
by the economic consequences of the attacks.
The New York Times used the framework of their 90-year-old Neediest Cases
Fund to launch a special one-month drive for their 9/11 Neediest Fund. It was
thought that $4 million could be raised in that time span considering that the annual
drive in 2000 had raised $8 million. Instead, more than $61 million was raised, with
donations pouring in long after the formal closing date of October 11, 2001. As of
September 2002, the fund had spent or committed 99% of the contributions.24
Money was distributed to 10 participating agencies such as Catholic Charities,
Community Services, Federation of Protestant Welfare Agencies, Fire Safety
Foundation, and the New York City Police Foundation. Some $2.3 million of the
funds was used to create the New York Consortium for Effective Trauma Treatment,
when it was found that few clinicians were trained to treat such trauma. These funds
are being administered by the four hospital-based trauma treatment centers in the city.
The money is being used to train 60 clinicians to treat trauma, and to pay half their
salaries for a year so that they can train others. Roughly 10% of the 9/11 fund is
being devoted to mental health issues.
In their 12-month report following 9/11, the directors of the 9/11 Neediest Fund
attempted to summarize some of the lessons learned about how charities could set out
to help so many people in sudden distress. They said
Working in a wartime atmosphere of scarcity, pain and confusion, many 9/11
Neediest Fund grantees have devised creative ways to help people. These new
approaches could potentially change the usual ways that we help the needy. The
key is connection....connection among agencies and experts within the same
field, connection among different fields, connection between public and private
agencies and connection between donors and recipients. Scott Williams of
Project Renewal described this spirit of connection in a memorably practical
way. ‘What was really amazing was how well the numerous different social
service agencies worked together after 9/11 .... there was a new spirit of
cooperation among people who usually compete fiercely for public dollars, with
23 Ibid, p. 18.
24 See [http://www.nytco.com/company/foundation/neediest/index.html], accessed Aug. 30,
2006.

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almost no territorialism. We partnered with agencies we usually fought with
over every aid dollar, and vice versa.’25
Religious affiliated organizations such as Catholic Charities USA, the Salvation
Army and the Federation of Protestant Welfare Agencies, increased and adjusted
their charitable activities in response to the emergency. Among these, the Catholic
Charities USA allocated more than $30.5 million to 25 local agencies located in the
New York metro area, New Jersey, Delaware, Pennsylvania, Virginia, Maryland, and
Washington, DC, among others, in response to the immediate tragedy and the
emotional and economic aftermath of the attacks. They provided immediate support
when a family or individual fell through the cracks of the aid bureaucracy, or had not
met the criteria of other agencies, or had sought out a confidential provider. And
they report that they continue to support the long term needs of families whose lives
were affected by the tragedy.26
In August 2002, the Salvation Army reported that it had received nearly $88
million in donations for its September 11 relief work, and that to date, about $65
million had been spent on primary services including financial aid to victims’
families and others whose livelihoods were affected. They estimate that the
remaining $23 million will be spent by the end of 2003, according to a two-year
spending plan developed in late 2001. The Salvation Army reported that it had
assisted more than 121,000 people in the almost one year since the terrorist attacks,
providing grief and mental health counseling, financial assistance, and other basic
social services. Salvation Army officers, staff, and 107,169 volunteers served almost
5 million meals to relief workers and victims at disaster sites in New York,
Washington, and Pennsylvania. Now that the work at the sites has ended, the
Salvation Army reports that it continues to serve those in need through its corps
community centers in New York and elsewhere around the country.27
Many organizations, unaccustomed to raising and dispersing donated money,
created their own funds as an expression of their concern. The National Association
of Home Builders, an industry group with 205,000 members, had promised their
members that all of the money they collected would go to the victims of 9/11.
Originally, the Home Builders had planned to turn the money over to the Red Cross
for distribution. When confusion concerning the dispersal of Red Cross funds began
receiving adverse publicity, the builders decided to distribute the $10 million they
had collected. In the process, they discovered how difficult it is to define need and
to make certain the money was appropriately distributed. Eventually, after much
debate, the Home Builders committee decided that money would be funneled from
the national group to an executive of the New York State Builders Association, who
would then distribute it to local chapters in the New York area; the local chapters
25 Report 9/11NeediestFund, available online from the New York Times website at
[http://www.nytco.com/company/foundation/neediest/lessons.html], accessed Aug. 30,
2006.
26 Catholic Charities USA [http://www.catholiccharitiesusa.org/search/content_displays.cfm
?fuseaction=display_document&location=6&id=342], accessed Aug. 30, 2006.
27 Information pertaining to Salvation Army activities relating to 9/11, was no longer
available at [http://www1.salvationarmy.org/], as of July 13, 2004.

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would be responsible for aiding needy victims. Applications came in slowly until the
general counsel for Associated Builders and Owners of New York noticed a
newspaper article about restaurant, hotel and janitorial workers who had been laid off
from jobs either in or near the World Trade Center. Twenty-four hours after calling
one union named in the article, the association was bombarded with applications
describing foreclosure notices, overdue credit bills, and past-due phone bills. In the
end, according to the New York Times article, the Home Builders did bring a modest
amount of relief to hundreds of families by funneling much of their money toward
this overlooked group who had experienced real hardships following the disaster.28
For a summary of the activities of some of the largest charities involved in the
relief of victims of the 9/11 disaster, please refer to the “Status of Selected Victim
Relief Funds” section, in this report.
In a related effort to provide increased access to aid, it has been suggested that
the problem of connecting victims of terrorism or any other disaster to philanthropic
and social services could be alleviated by instituting an abbreviated 211 dialing code
nationwide. On July 21, 2000, the Federal Communications Commission (FCC)
granted the abbreviated dialing code 211 as the universal number for accessing
information about community resources. According to a United Way document, as
of January 2000, 211 was under consideration in 48 states that had not yet launched
a 211 service, but significant activities in regard to starting 211 services had begun
in at least one locality in 33 of those states. The Brookings Institution and the Urban
Institute collaborated on a report entitled “Calling 211: Enhancing the Washington
Region’s Safety Net After 9/11,” dated September, 2002, with a policy
recommendation that local jurisdictions should create a 211 system (a regional
information and referral network) in the Washington, DC, metropolitan area.
Congressional Oversight Hearings
With so much money raised, with so many charities involved, and with reports
of concern regarding the distribution of these funds, hearings were held in the U.S.
House of Representatives on November 6,29 and November 8, 2001,30 addressing
charitable contributions for September 11. On November 6, representatives from the
American Red Cross, the United Way and the New York Community Trust, and the
International Association of Firefighters testified before the House Committee on
Energy and Commerce. Officials from the Federal Trade Commission (FTC), the
federal government’s principle consumer protection agency, also testified as did the
New York State Attorney General. On November 8, the American Red Cross,
September 11th Fund (United Way N.Y.), Salvation Army, the New York State
28 David Barstow, “ Lesson in Hands-On Charity: Giving Away Cash Isn’t Easy,” New York
Times, Feb. 19, 2002, Sec. A. p. 1.
29 U.S. Congress, House, Committee on Energy and Commerce, Subcommittee on Oversight
and Investigations, Charitable Contributions for September 11: Protecting against Fraud,
Waste, and Abuse, hearings, 107th Cong., 1st sess., 2001.
30 U.S. Congress, House, Committee on Ways and Means, Subcommittee on Oversight,
Charitable Organizations’ Distribution of Funds Following Recent Terrorist Attacks,
hearings, 107th Cong., 1st sess., 2001.

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Attorney General, the American Bar Association Tax Section of New York,
American Institute of Philanthropy, Better Business Bureau, and the Exempt
Organizations Division of the Internal Revenue Service testified before the House
Committee on Ways and Means.
In the November 6 hearing, New York State Attorney General Eliot Spitzer
testified that he “was charged with overseeing those charities that solicit funds in ...
[N.Y.] state, as well as the charitable organizations, including foundations and
charitable trusts, which are created in or hold assets in ... [N.Y.] state .... to help
ensure that the interests of the public are protected when charitable funds are raised
and spent.” Toward that end, Attorney General Spitzer identified five critical areas
to provide such protection, as follows: (1) making it easier for victims to learn what
relief is available, and to access that aid; (2) creating a victims database, to facilitate
coordination, avoid duplication and ensure fairness in the aid distribution process;31
(3) providing the American public with information about the amount of donations
received and expended, and the purpose of those expenditures; (4) investigating and
prosecuting any instances of fraud and abuse that arise; and (5) ensuring that a
working group of charities and victim advocates is established, to solve problems as
they arise and swiftly identify gaps in the services required to meet victims’ needs in
the future.
A concern was raised by committee members that when a specific fund is set up
for a specific need (e.g., the Red Cross Liberty Fund for victims of 9/11), then the
expectation of donors is that all of the money raised in that fund will go to meet that
specific need unless it is very clearly stated that some of the money would be put in
reserve accounts for similar tragedies.32
This idea was reinforced by the testimony of a representative of The Better
Business Bureau Wise Giving Alliance, a nationally recognized monitoring
organization that sets accountability standards for charities and other soliciting non-
profits. The committee was told that the BBB Wise Giving Alliance had
commissioned Princeton Survey Research Associates to conduct a “Donor
Expectations Survey,” in the spring of 2001. This survey was released in September
2001. The findings indicated, among other things, that 86% of Americans gave to
charities in 2000; that Americans have very high expectations for ethics and
accountability by the charities; and that first and foremost the public needs to know
how the charity is spending their money. Specifically, 63% of the public expects the
money to be used for current needs rather than put in a reserve and 73% rate the
accuracy of a charity’s advertising and promotion as very important.33
31 WTC Relief Info, available on the Internet at the World Trade Center Relief Info site
[http://www.oag.state.ny.us/charities/wtcrelief/], accessed Aug. 30, 2006.
32 Also see General Accounting report entitled, September 11; More Effective Collaboration
Could Enhance Charitable Organizations’ Contributions in Disasters, GAO-03-259, Dec.
2002, pp.18-20.
33 For the full report see [http://www.give.org/news/surveyintro.asp], accessed Aug. 30,
2006.

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A general consensus was among those testifying at the hearing that there was
very little known fraud concerning the funds. Even though the percentage of people
willing to take advantage of the 9/11 tragedy was very small (only 1% of recipients
took aid they weren’t entitled to according to charity executives), the Special
Prosecutions Bureau in the Manhattan district attorney’s office has kept busy
prosecuting World Trade Center cases. According to a July 16, 2003 Washington
Post article, 364 people were charged with stealing more than $4.3 million. The
great majority of these cases ended not with trials, but with guilty pleas because the
perpetrators did not want to face a jury. In the handful of trials that were held, there
were no acquittals.34
Background on Selected Victim Relief Funds
An overview report issued by the Attorney General of New York one year after
the September 11 attack lists 52 charities that can account, as a group, for more than
90% of the donations for the relief effort. The report stated that as of September
2002 charities had collected well over $2.2 billion in donations, with much of the
money coming in during the first 60 days after the attacks. In many instances,
financial information regarding the program activities of the funds active in the early
stages of the September 11 relief effort will not be available until the respective
charities file their required “Form 990’s” with the Internal Revenue Service or the
Charities Bureau of the N.Y. Attorney General’s Office. The New York Attorney
General stated that, “it is important to note that this survey, while broadly inclusive
of the many types of charities active in the relief effort, does not constitute a
complete description of the September 11 charitable sector.”35 For further
information concerning the unique challenges charitable organizations face in
soliciting contributions, selecting beneficiaries, and distributing funds for wide-scale
disaster relief, see the policy brief by the Urban Institute, Managing Charitable
Giving in the Wake of Disaster.36
In the Attorney General’s report, each organization is classified in four basic
categories (many charities fall into more than one category): direct aid providers
(those that included in their activities the distribution of cash assistance and/or
reimbursement of victims’ living expenses); service providers (those that assisted
victims, e.g., through the efforts of their staffs and volunteers); scholarship providers;
and grant-makers (those that addressed September 11 by awarding funds to other not-
for-profits that would, in turn, provide direct aid or services). The following are
some of the largest charities listed for the New York Attorney General’s report; the
classification of the charity is included, following the name of the fund.
34 Paula Span, “Profiteers of Pain,” Washington Post, July 16, 2003, p. C01.
35 September 11th Charitable Relief: An Oversight at One Year (Rept. of N.Y. Atty. General)
[http://www.oag.state.ny.us/charities/september11_charitiable_report/sept11_report.html],
accessed Aug. 30, 2006.
36 Eugene C. Steuerle, “Managing Charitable Giving in the Wake of Disaster,” Charting
Civil Society, no. 12, May 2002.

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New York State’s World Trade Center
Relief Fund Distribution (A direct aid organization)
This fund was established on September 14, 2001. Governor George Pataki
announced that as of September 16, 2002, of the $68 million donated to the fund,
more than $59 million has been distributed to the families of victims of the
September 11 terrorist attacks. The fund has issued more than 13,000 checks to
members of more than 2,400 families. Under the fund, the surviving spouse or
domestic partner of each victim will receive a total of $17,000; any surviving child
of the victim who is 21 years of age or younger will receive a total of $7,500,
(children over 21 will be eligible for a total of $7,500 if they can establish that the
victim was the source of at least 50% of his or her financial support). If there is no
surviving spouse, partner, or child, a total of $17,000 will go to the parents of the
victim; the fiancee of a victim will receive a total of $17,000. This fund has no
administrative costs.37
Twin Towers Fund
(A direct aid organization and a service provider organization)
Former Mayor Rudolph W. Giuliani established this fund to assist, support and
recognize the families of the members of the uniformed services of the New York
City Fire Department and its Emergency Medical Services Command, the New York
City Police Department, the Port Authority of New York, the New Jersey Police
Department, the New York State Office of Court Administration and other
government officers who lost their lives or were seriously injured because of the
terrorist attack of September 11, 2001.38 By mid-2003 the Twin Towers Fund
distributed funds to 438 beneficiary families. While active, the fund collected
approximately $209 million and distributed approximately $196 million with
another distribution scheduled this year; operating expenses were kept to less than
1% of assets.39
37 Information was retrieved from [http://www.nysegov.com/news/WTC_Relief_Dist.html]
on Sept. 2, 2003, which is no longer available on the Internet.
38 In October 2001, Saudi Prince Alwaleed bin Talal donated $10 million to the Twin
Towers Fund along with a condolence note. New York Mayor Rudolph Giuliani rejected
the donation the next day after a news release was published where the Prince said,
“However, at times like this one, we must address some of the issues that led to such a
criminal attack. I believe the government of the United States of America should re-
examine its policies in the Middle East and adopt a more balanced stance towards the
Palestinian cause.” Jennifer Steinhauer, “A Nation Challenged: The Donations,” New York
Times, Oct. 12, 2001, Sec. B, p. 13.
39 For updates see [http://www.twintowersfund.com/Distribution.html], accessed on Aug.
30, 2006.

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Liberty Disaster Relief Fund (Red Cross)
(A direct aid organization and a service provider)
On September 20, 2001, the Red Cross established the Liberty Disaster Relief
Fund as a separate, segregated account to fund relief services related to the
September 11 attacks. As of September 11, 2002, the fund revenue was more than
$1 billion. Besides immediately setting up stations for relief and recovery at the sites
(New York, Pennsylvania, and the Pentagon), a new program called the family grant
program was developed where, through an easy one-page application with no
receipts, a victim’s family was able to receive up to roughly $30,000 within 48 hours
of application to assist the family with mortgage payments, food, and other bills.
Initially, there was some confusion, within the Red Cross leadership and the
public, about whether the entire Liberty Fund was to be used solely to care for the
victims of the September 11 attacks, their families, and the rescue workers, or
whether parts of this fund would be set aside to prepare for future terrorist attacks (a
set-aside is typical of the way the Red Cross deals with other types of disasters such
as hurricanes). On November 14, 2001, after the congressional hearings on
November 6 and 8, 2001, the Red Cross held a news conference to say that it would
spend the entire Liberty Fund to care for the victims of the September 11 attacks,
their families and the rescue workers and thereby, “... hope to restore the faith of our
donors and the trust of the American public.” On December 27, 2001, the Red Cross
asked Senator George Mitchell, former Senate Majority Leader, to serve as the
independent overseer of the Liberty Disaster Fund to assure donors that their
financial contributions were properly allocated to meet the ongoing and long-term
needs of the 9/11 victims and their families.
Senator Mitchell’s final report dated February 1, 2003, states that the Red Cross
has already used $741 million from the Liberty Fund to help more than 55,000
families cope with the death of loved ones, serious injuries, physical and mental
health concerns, financial loss, homelessness and many other effects of the attacks.
In addition, $99 million has been spent on disaster relief services including serving
more than 14 million meals to families and emergency workers, providing crisis
counseling for more than 238,000 individuals and operating 36 service delivery sites.
Seriously injured individuals and the estates of the deceased have received gifts of
$55,000 each. The Red Cross will continue aiding victims with long term needs such
as mental health and health care by allocating more than $143 million for their Long-
Term Disaster Relief Services.40 For example, the American Red Cross September
11 Recovery Program announced on July 1, 2004, that it has allocated $50 million
from the Liberty Disaster Relief Fund to a nationwide grant-making program to
support the longer-term recovery needs of people directly impacted by the events of
September 11, 2001.41
40 A Review of the American Red Cross’ Response in the Past Year, Sept. 2002, at
[http://www.redcross.org/press/disaster/ds_pr/030203finalreport.html], accessed Aug. 30,
2006.
41 WTC Relief Info., Office of the N.Y. State Attorney General.
[http://www.oag.state.ny.us/charities/wtcrelief/], accessed Aug. 30, 2006.

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September 11 Fund (United Way) (A grant making organization)
The September 11th Fund was established by United Way and New York
Community Trust on September 11, 2001, to provide relief to victims and their
families. As of April 1, 2004, $537 million was collected ($511.5 million in grants
were distributed to 531 grantees). The breakdown of fund usage was $446 million
(87% of the total) went toward cash assistance and services for victims and families;
$55.5 million (11% of the total) went toward assistance to communities; and $10
million (2% of the total) went toward rescue and recovery efforts. There were
100,000 people who received cash assistance, including 3,800 surviving families and
the severely injured; 35,000 who lost jobs; and 6,000 who were displaced from their
homes.42
International Association of Fire Fighters — New York
Firefighters 9-11 Disaster Relief Fund (A direct aid organization)
On September 13, this fund was established to provide financial assistance to
the families of all fallen firefighters and to coordinate efforts to assist fire and
emergency medical services personnel on the scene in New York City.43 As of June
30, 2002, the fund raised more than $159 million, with 90% of the fund disbursed
including 1% used for administrative purposes.44
Safe Horizons (A direct aid organization and a service provider organization)
As reported in the New York State Attorney General Report, Safe Horizons
raised nearly $110 million as of June 30, 2002, with 96% of the fund disbursed and
with 1% used for administrative purposes. (Safe Horizons aid and services were
funded predominantly by the September 11th Fund). According to their website, Safe
Horizons helped 9/11 victims and relatives apply for emergency compensation to
cover immediate expenses (rent, utilities, groceries etc.) as well as funeral expenses
and longer-term counseling. Presently, Safe Horizon Counseling Center, a licensed
mental health facility specializing in trauma counseling, offers group crisis support
to individuals as well as to businesses and organizations whose employees are
experiencing trauma and other related issues. Crisis Response Teams are available
to meet staff, provide group support sessions and consult with human resources
professionals for referrals to additional health and practical services.45
42 For updates see [http://www.september11fund.org/], accessed Aug. 30, 2006.
43 Since this fund does not have a Web page that discusses the dispersal of funds, funding
information was obtained in the one year overview report prepared by the New York State
Attorney General.
44 [http://www.oag.state.ny.us/charities/september11_charitiable_report/sept11_report.html],
accessed Aug. 30, 2006.
45 See [http://www.safehorizon.org/page.php?page=sept11], accessed Aug. 30, 2006. Fund
dispersal information is not included in the Safe Horizons website.

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Families of Freedom Scholarship Fund
(A service provider organization)
This fund, founded on September 17, 2001, by Citizens’ Scholarship Foundation
of America (CSFA) and the Lumina Foundation for Education, is co-chaired by
former President Bill Clinton and former Senate Majority Leader Bob Dole. The
fund provides education assistance for postsecondary study to dependents of those
killed or permanently disabled as a result of the September 11, 2001 terrorist attacks
and during the rescue activities relating to those attacks. Specifically, the fund will
benefit dependents of the victims, including airplane crew and passengers, World
Trade Center and Pentagon workers and visitors, and relief workers, including
firefighters, emergency personnel and law enforcement personnel. A fund-raising
goal of $100 million was set. As reported in the 2002 CSFA annual report, the fund
raised $105 million in less than one year.46 Funds were received from more than
20,000 donors. CSFA pledges that 100% of all contributions to the fund will support
undergraduate education of eligible students. The fund extends to currently enrolled
students as well as future students continuing through the year 2030. As of
September 2002, approximately $865,000 in scholarship assistance has been
distributed to 114 students currently enrolled in postsecondary study. Also, as of that
date, 2,169 eligible individuals have registered in the CSFA data base, including
1,474 children, 669 spouses and 26 domestic partners or children of domestic partner
relationships.
Uniformed Firefighters Association Widows
and Children’s Fund (A direct aid organization)
The September 2002 report of the New York State Attorney General stated that
this fund has raised $71 million since the September 11 disaster; the Attorney
General also reported that 51% of that amount had been disbursed as of September
2002. One percent of the funds raised was used for administration of the funds.
Beneficiaries of the fund are listed as family survivors of the uniformed services. 47
The New York Police & Fire Widows’ &
Children’s Benefit Fund (A direct aid organization)
This fund was established 17 years ago. In a summary dated September 1, 2002,
it was reported that after the events of 9/11 more than $115 million was raised. The
funds were quickly distributed, with $100,000 going to each September 11 widow
or widower, including New York City police officers and firefighters, Port Authority
police officers and emergency medical services personnel. An additional $18,000
was expected to be distributed to each of the 9/11 widows in October 2002. Further,
for 17 years the fund has sent annual distributions to the “historical” widows of New
York police; in conformance with this practice a one-time $30,000 distribution was
46 See [http://www.scholarshipamerica.org/_common/files/arcs02.pdf], accessed Aug. 30,
2006.
47 [http://www.oag.state.ny.us/charities/september11_charitiable_report/sept11_report.html],
accessed Aug. 30, 2006. Fund dispersal information is not included in the website.

CRS-17
made to each of these widows with an additional $8,000 distributed to these widows
in October 2002. It is expected that approximately $12,000 will be distributed
annually to each of the approximately 715 widows and widowers (both 9/11 and
historical) beginning in 2003, and continuing for each year through 2009.48
48 See [http://www.nypfwc.org/about_us.cfm], accessed Aug. 30, 2006.