Federal Recovery Money Goes Unspent

Late breaking news from NYTimes on 9/5: As Disasters Multiply, Billions in Recovery Funds Go Unspent. Some excerpts:

The Trump administration is sitting on tens of billions of dollars in unspent recovery money meant to help Americans recover from disasters, leaving people less able to rebound from the effects of Hurricane Dorian and other storms.

As of June 30, the government had spent less than one-third of the $107 billion provided by Congress following the hurricanes and wildfires of 2017 and 2018, federal data show. The Department of Housing and Urban Development, which received $37 billion — more than any other agency — had spent less than $75 million.

Please take a look at the comments, since they come from folks who have worked in the field.

2 thoughts on “Federal Recovery Money Goes Unspent

  1. I was happy to read the explanation from Harry Kellog in the sense of understanding what could be happening, as I was wondering if the difference was between spent and encumbered funds. I know working in Commerce and Community Development after a Vermont declared disaster, that towns and municipalities expressed what the damage was but then had to go about all the approval processes to bring the property back to what it was or in some cases make it better than it was, thus mitigating the issue. These things could take two or three years to approve due to regulations, so on paper, it might look as if funds weren’t spent but they were earmarked for an approved project.

  2. One of the most egregious policy decisions over the last few decades is the denial of survivor’s personal property grants. In Katrina $314 million in FEMA Verified Personal Property loss was withheld from individuals who were trying to recover. In Sandy it was $31million with $10 million held back from the poorest of the poor.

    On paper it all looks quite straightforward. FEMA is asking that the individual contact the Small Business Administration (SBA) about applying for a Disaster Home Loan to determine if they qualify for a loan or grant. Up to 80% of the survivors contacted, do not comply, because they are … not a small business, or they don’t want a loan, or they think it’s a scam or they are functionally illiterate. For whatever reason hundreds of thousands of survivors have been deprived of hundreds of millions of dollars in recovery funds they are authorized to receive under the provisions of the Robert T. Stafford Disaster Relief and Assistance Act.

    The numbers are truly astounding.

    On the surface, what FEMA and the SBA are requiring seems quite reasonable, but when the average failure rate is 80% there is something wrong and corrections must be made, to date they have not. If you do pin down someone of knowledge in FEMA or the SBA, about this problem, the term “duplication of benefits” is the reason given. By law, FEMA cannot duplicate assistance that a survivor has already received. The SBA had been given the job of seeking the truth.

    FEMA, the SBA, and Voluntary agencies put a lot of time and effort into trying to educate the public that if they receive a phone call or correspondence from the SBA they should respond. As a Voluntary Agency Liaison with FEMA for 12 years, I must have given 500 presentations on how important it was to return their loan application. I explained that there was a good chance they would be denied the loan and would receive a grant for their lost personal property. I made it clear, that even if they somehow qualified for the loan they didn’t have to take it. We’ve had clergy speak to them from the pulpit, we’ve trained volunteers to assist applicants in filling out the forms and we’ve called them. It’s still not working.

    What is most tragic about the situation is that the solution is simple. The policy should be changed! It is a policy and not legislation. There must be a dozen ways to determine if a “duplication of benefits” has occurred besides contacting the Small Business Administration.

    Until the policy is changed, if a survivor calls and says they make zero income, the FEMA Intake personnel, should coach them or ask a few simple questions like…

    How do you eat? How do you pay your rent? Do you receive any funds from the government?

    In other words, do what the SBA does, research. That would bring to light the fact that they indeed do have an income and it probably is below the threshold for receiving a Disaster Home Loan and the grant for their personal property would be sent to them. Why can’t the FEMA Call Center personnel assist them with this challenge like they do for a wrong address or invalid ID, etc.?

    The good people at the FEMA Call Centers assist people who are having trouble answering questions all the time. Why not let them assist in overcoming this heinous obstruction to personal recovery?

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