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Who’s to Blame?

Posted on 05. Apr, 2013 by

The HUD Inspector General just issued a report saying that 85% of homeowners who received elevation incentive grants through the Road Home Program have failed to elevate their homes. I can’t say I’m surprised by this- the Road Home Program’s failings have been well-documented over the years, and this is just another case of incompetence on the part of the State of Louisiana and its contractors.

The Road Home decided in 2008 that rather than have homeowners elevate their homes and then be reimbursed for elevation work, every applicant who chose to rebuild could get a flat $30,000 for elevation. It did not matter if:

1. The house even needed to be raised

                                     or

2. If the cost would far exceed the paltry sum of $30,000, which in most cases it did.

Predictably, homeowners struggling to get back in their homes after Katrina took the money. Most probably figured they were using the money to fix their homes anyway, and already felt shortchanged by the Road Home Program.  Others had probably heard about the mysterious Hazard Mitigation Grant Program (HMGP), and thought they would be able to combine that $100,000 grant with the Road Home elevation money, thus having no problem getting their home raised.

Of course, none of these things happened. $30,000 was clearly never enough to elevate, and thousands of homeowners found out they weren’t eligible for the HMGP. The average elevation cost is around $80,000, and with HMGP paying up to $100,000, many building contactors raised their prices even higher to get the most money they could. Some homeowners took the $30,000, and then found out later their houses didn’t even need to be raised, which would be quite a shock after taking on 6 feet of water during Katrina. If a house was already raised above FEMA’s base flood elevation level when Katrina hit, then the state and FEMA would say there is no need to raise it any more. Hard to believe, especially when I see houses in neighborhoods that didn’t even flood jacked up 10 feet.

The state says they’re working to get people in compliance.  In their code, that means trying to collect that money back from homeowners who didn’t elevate. But that’s just another chapter in the long book of the blame game that has played out for Katrina survivors over the last several years.  Thousands already have been forced to pay back money to FEMA they apparently didn’t deserve, and now it appears the State is going to do the same.

How about considering forgiveness?

The State never should have given this money out in the manner it did, and probably only did so because of pressure to get more money on the street, so it ought to shoulder most of the blame. If anyone is going to have to pay the money back to the federal government, let the State of Louisiana, or its multimillion dollar private partner ICF International foot the bill.  Not the struggling homeowners who were supposed to be the beneficiaries of this twisted Kafkaesque nightmare called the Road Home.

One Response to “Who’s to Blame?”

  1. Belinda Montegut 9 January 2014 at 8:13 pm #

    This article has described my situation perfectly. Now that my husband of 30 years has passed away, it leave me no choice (financially) but to apply for a reverse mortgage. The reverse mortgage is in process but now Road Home has stepped in saying there is a lien on my house and that I must pay back $30,000 because of non elevation. I explained that was not enough money at the time and that the HMGP did not assist despite the many calls and e-mails sent to them for assistance. Ms Jill went on to say I will be getting a bill for $30,000 from the Road Home Program and can make payment arrangements. I may have to cancel the reverse mortgage because of this. I am on a fixed income and cannot afford to pay another bill. Any suggestions or comments? Thank You,