Audit Says FEMA Squandering Katrina Aid

The Associated Press

Wednesday 06 December 2006

Washington - One year after Katrina, the government is still squandering tens of millions of dollars in wasted disaster aid, including $17 million in bogus rental payments to people who had already received free trailers and apartments, federal investigators said Wednesday.

At the same time, the Federal Emergency Management Agency has recovered less than 1 percent of the $1 billion it wasted on fraudulent hurricane assistance after the August 2005 storm, highlighting a need for stronger controls the next time a major hurricane strikes.

The report by the Government Accountability Office, set to be released later Wednesday, paints a picture of an agency still struggling - at substantial taxpayer expense - to find the balance between distributing quick aid to those in need while guarding against substantial abuse.

Last week, a federal judge in Washington ordered the Bush administration to resume housing payments for thousands of people displaced by Katrina, criticizing FEMA for a convoluted application process. FEMA is appealing that ruling.

The GAO audit found that numerous aid applicants received duplicate rental aid, with FEMA in one case providing free apartments to 10 people in Plano, Texas, while sending them $46,000 to cover out-of-pocket housing expenses.

Another $20 million was wasted on thousands of individuals who claimed the same property damage from both Hurricanes Katrina and Rita. FEMA also paid at least $3 million to more than 500 ineligible foreign students in the stricken Gulf Coast, the report said.

"Ineffective preventive controls have resulted in substantial fraudulent and improper payments," said GAO investigator Gregory Kutz. "The additional examples of potentially fraudulent and improper payments in our testimony today show that our estimate of $1 billion in improper and/or fraudulent payments is likely understated."

A spokesman for FEMA did not have an immediate comment.

Among the audit's findings:

* Fraud detection is inadequate. Even though GAO found at least $1 billion in ?isaster aid waste, FEMA has identified about $290 million in improper payments and recouped just $7 million.

* Control procedures remain weak. FEMA was unable to locate dozens of laptops, printers and other items that federal employees purchased with government-issued credit cards for Katrina disaster work. In one case, FEMA purchased 20 flat-bottom boats, but could not find two of them and lacked titles to any of them.

Sen. Susan Collins, R-Maine, who requested the report, said she is hopeful that her legislation seeking to empower FEMA by giving director David Paulison direct access to the president in a crisis might offer some relief.

Still, FEMA must do more to revamp its disaster aid procedures, said Collins, who chairs the Senate Homeland Security Committee.

"The American people are generous and willingly open their hearts and their wallets to the victims of disasters," she said. "But they expect that their tax dollars will be spent carefully to help storm victims, not be lost to a hurricane of waste, fraud and abuse."



Go to Original

Storm Evacuees Remain in Grip of Uncertainty
By Shaila Dewan
The New York Times

Wednesday 06 December 2006

Baker, La. - Wynaen Walker keeps a change of clothes, her prescription medications and important papers in the trunk of a friend's car. When she leaves her FEMA trailer, she tapes handwritten signs on the door with her phone number. "I still live here," one of them says.

Ms. Walker does this not so much because Hurricane Rita destroyed her house in Lake Charles, but because in October, she came home from church to find her trailer, in a park here operated by the Federal Emergency Management Agency, occupied by someone else. The lock had been changed. The meager belongings she had accumulated since the hurricane were gone.

"Imagine leaving your house, and you're going right up the street," said Ms. Walker, known as Nina, who was told by FEMA officials to seek out a homeless shelter. "I come back, I ain't got no place."

"They left me out in the cold," she added. "I really panicked."

Ms. Walker had been displaced by a family from one of five FEMA trailer parks at the nearby Baton Rouge Metropolitan Airport that are scheduled to close in April. Though her move was a mistake, it is one that residents say the agency has made repeatedly in its trailer parks. And when the trailers at the airport are shut down next year, more than 600 families who took refuge in those parks will find themselves on the move once again.

More than a year after Hurricanes Katrina and Rita, life is still precarious and unpredictable for many evacuees, especially those who have depended on the government for a modicum of stability. About 102,000 families are still living in government trailers scattered around the region, and an additional 33,000 are living in apartments paid for by FEMA. What trauma victims need most, stability, is just what has proved most elusive.

Most families in the five parks that are closing have not been told where their new homes will be. In New Orleans, residents at two FEMA trailer parks were notified that the construction of a film studio nearby would mean ceaseless noise for months. Initially they were told the parks would close, but the families refused to move yet again.

For thousands more displaced families living in apartments, FEMA has cut off aid with little explanation, but the agency was ordered by a federal judge late last month to reinstate the aid and pay months of back rent. The judge described the ordeal of the families, many of whom have already left their apartments or are on the brink of eviction, as "Kafkaesque."

The seesaw of daily life for the displaced is playing out against a backdrop of still larger uncertainties. Billions of dollars intended to help homeowners rebuild have yet to be distributed. And on Saturday, at a "town hall" meeting held simultaneously in five cities, Mayor C. Ray Nagin of New Orleans said he did not expect the city's rebuilding plan to be finished until mid-January.

Mental health experts have repeatedly warned of the importance of a consistent environment for adults and children who are recovering from trauma, and evacuees complain that stress has aggravated their physical ailments, literally making them sick.

And people who work at the agencies trying to help evacuees no longer bother to conceal their anger and astonishment at the constant change in policies and how they are carried out.

"People are basically in many instances left to fend for themselves, while being hampered, if not prevented, from fending for themselves," said Raymond A. Jetson, the chief executive of the Louisiana Family Recovery Corps, a nonprofit organization started at the behest of Gov. Kathleen Babineaux Blanco.

Mr. Jetson added, "There is a misunderstanding that in some way these people have abdicated the expectation of being treated with respect and dignity."

Jim Stark, the director of the Louisiana Transitional Recovery Office at FEMA, acknowledged that finding permanent housing had been "more difficult than anyone anticipated." On the other hand, he said, "The travel trailers aren't meant as permanent homes."

For those who got apartments instead of trailers, the rental assistance program has been rife with confusing letters, repetitive requests and conflicting information from FEMA. The agency has consistently defended the process, saying that any denial of benefits can be appealed within 60 days.

But in last month's ruling, Judge Richard J. Leon of Federal District Court disagreed, saying the inconsistencies amounted to a denial of the due process rights of evacuees. He ordered FEMA to clarify the eligibility requirements and "immediately restore" many families to the program. [On Tuesday, FEMA appealed the ruling.]

So far, though, said Cindy Gabriel, the spokeswoman for the Community Settlement Network, which has taken over for Houston's evacuee housing program, the ruling has done little but create confusion, in part because FEMA's lawyers have given no indication of how they will carry it out.

Christalyn Mavis, 20, an evacuee living in Austin, Tex., said she and her fiancé had been threatened with eviction for months while they tried to convince FEMA that they were eligible for rental assistance. In September, Ms. Mavis, who lost her mother in Hurricane Katrina, gave birth to a boy, adding urgency to the couple's need for resolution.

"We were in the recovery room," she said, "and I was getting in touch with my lawyer and caseworker from the hospital hours after giving birth."

Tired of fighting, the couple now hope to move to a less expensive city.

In Baton Rouge, the five trailer parks are closing because the airport has declined to renew the lease. Mr. Stark said the residents who did not find their own housing would be moved, but the agency is not yet sure where. "We're going to try to be as least disruptive to the families that live there as possible," he said.

Yet even the moves that FEMA has already orchestrated have not necessarily been smooth. Kim Landry, the transitional communities coordinator for the Family Recovery Corps, said caseworkers knew of five cases like Ms. Walker's in which people had returned home to find their property, or in some cases their entire trailer, gone.

"We do make regular sweeps through the parks, and we often find that people have moved without telling us," Mr. Stark said. "If it looks like no one's home and we haven't been able to contact the folks, we will close the trailer."

FEMA procedures call for three attempts to contact a resident by phone and the posting of an abandonment notice before a trailer is cleaned out. The contents are supposed to be "bagged and tagged" and stored for 30 days. But, an agency spokeswoman said, "maintenance and deactivation contractors" have a "realistic margin of error."

Ms. Walker, who is 49 and has diabetes, high blood pressure and arthritis, was eventually issued a new, empty trailer. But the belongings on her carefully written list - "engagement ring $1249.99 pl. tx." and "clothings new - (7) outfits" - have not been recovered. On Tuesday, she has an appointment at the FEMA storage facility to look for them. At the mention of this, Ms. Walker, who with her chipper grin, multicolored sweater and braided pigtails is a picture of stoic cheer, broke down like a child.

"The stuff that was taken out of my trailer wasn't bagged and tagged," she wailed. "Mine wasn't bagged and tagged. It's hard starting over again. You know. Everything. It's very hard."

Then she pulled herself together, straightened up, and smiled.

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