Getting closer to finding out why so many Texas hurricane survivors were denied housing assistance

The pieces are slowly coming together to answer the question, why were so many applications for FEMA housing assistance in the wake of Hurricane Ike denied by FEMA?

While more than 82,000 households affected by Ike have received almost $371 million in FEMA funds for repairs, more than 730,000 families requested help from FEMA, meaning that almost 650,000 registrants received no housing assistance.

Here is the emerging picture.

First, we learn from a story written by Mike Snyder of the Houston Chronicle that the damage inspectors hired by FEMA to review claims were poorly trained, often lack a background in construction and are under pressure to perform inspections quickly and to deny applications for assistance.

Snyder’s article states…

With varying levels of training and experience, these inspectors are motivated to work quickly because they’re paid a flat fee per inspection and must cover most of their own expenses.

These factors and others have created a flawed inspection system that withholds assistance from many deserving families, according to a former FEMA inspector and lawyers representing families who say they were unfairly denied assistance or didn’t get enough to repair their homes.

Second, there is the apparently illegal practice that FEMA engages in of denying assistance completely because of “deferred maintenance” to the home. Texas Rural Legal Aid (TRLA) has sued FEMA in federal court and a federal judge has ordered FEMA to explain the standards it uses to deny benefits to families whose homes had maintenance or structural problems prior to a disaster.

A FEMA official explained the high denial rate as follows: “A lot of the homes built were built from second hand materials. So the damage was, in most cases, caused from the faulty building of the house, and not the storm.”

This a curious and apparently illegal standard that FEMA is applying. It may be true that the homes of these families were not in good shape before Hurricane Dolly. But their homes were providing them shelter and as a result of the hurricane their homes are now uninhabitable.

The FEMA program is intended to help people regain a place to live. It has systemically failed low income families because of the illegal decisions by FEMA to deny assistance to these families, in essence, because of their pre-existing shelter poverty.

Finally, members of Congress have begun asking questions.

During a House Homeland Security Subcommittee on Emergency Communications, Preparedness, and Response hearing held on June 9, Representative Michael McCaul (R-TX) said he would request that the General Accounting Office (GAO) look into the cause for the high rate of Hurricane Ike damage claims and would also request that the subcommittee hold a future hearing to investigate a large disparity between the response to hurricanes Ike and Katrina.

Subcommittee Chair Henry Cuellar (D-TX) indicated in response to Rep. McCaul’s request that hearing would be likely.

Here’s Representative McCaul’s question to newly appointed FEMA administrator Fugate about the issue…

Representative McCaul: I also want to make a comparison between Katrina and hurricane Ike. There appears to be a large disparity in the amount of payments.

Now granted Katrina was a larger scale type hurricane, there were a lot of differences between the two hurricanes, but I just wanted to throw out a few figures. For instance, under housing assistance there were 506,000 applicants under Ike and under Katrina there were 939,000 applicants. Under Ike, only 17% of the applicants received assistance and under Katrina 74% received assistance. That’s a fairly wide disparity when you talk about 17% were actually granted versus 74 in Katrina.

Under other needs assistance a total of 65,000 applicants were approved under Ike and about 265,000 under Katrina. The average payment, when you compare Katrina to Ike, Katrina was about $5600, Ike was about $1700. So there is about a three times variable there in assistance granted between Katrina and Ike.

Finally, total assistance for the average payment per registrant for Ike came to $722 versus Katrina that came in a number of $4000, almost $5000. So $5000 versus $722. It seems to me a big discrepancy.

I have asked the GAO to look at these numbers, explain why this disparity, and I know there are probably reasons for it and dancers for it. But I have asked the GAO to do a study and Mr. Chairman I intend to send a letter to you asking for a hearing on this issue so we can find out, number one did we learn something from Katrina, maybe we’re saving the taxpayers money and there’s a good story here.

But I’d also like to know, being from Texas, and having my constituents hit by hurricane Ike, I’d also like to get the answer to the question: why such a big disparity?

FEMA Administrator Fugate: The short answer is I would have to look into it.

What I would recommend in asking for this review is, one of the things I’d like to know, I’d like to ask is, given the payouts, what kind of damage was incurred per household. Was it a household destroyed or household damaged and what that percentage was.

The other thing is that the bias in our controls now is filtering out people who would otherwise be eligible. It’s always a balancing act, the more accountability the more checks and balances the more people who are outliers who don’t fit the definition perfectly but are eligible who fall out. And we saw this in our ’04 hurricane season. We had to devote tremendous staff time just to work with people so that the automatic systems that would kick them out, and they were still eligible, we’d have to go back and work casework on each one of those to make sure.

Our goal is that if it’s based upon the eligibility and it’s warranted we should award that as effectively as possible. We should do everything we can to monitor and control fraud, but it’s a balancing act so to me it would be interesting to look at what the household damages percentagewise, that would reflect payment. But also by the controls were putting into place to control fraud penalizing people and how do we strike the proper balance between speed and effectiveness but not having the runaway situation where there are lack of fiduciary controls on who is getting assistance who’s not warranted and that actually takes away from the people who are most vulnerable.

Representative McCall: I agree there’s a balance you need to strike and right after hurricanes hit as they have in our state we advocate on behalf of our constituents to make sure they get the assistance they need and sometimes we don’t think that comes fast enough.

I know the chairman mentioned that people were still in these rental assistance properties in New Orleans. I don’t know what the status of the trailers are but at some point we need to kind of move on and close the chapter. I’d be interested in your thoughts on that and be interested in what the GAO has to say as well.

Mr. Chairman, I do hope that we could have a hearing on this issue.

The committee should conduct a hearing. They should specifically look into the issue of the qualification and training of FEMA inspectors and in the FEMA policy of denying hurricane survivors assistance because of “deferred maintenance”. Congress should direct FEMA to take a second look at all those who were denied assistance due to “deferred maintenance” or other questionable causes.