Texas home rebuilding for hurricane survivors unacceptably slow

As we approach the four year anniversary of Hurricane Rita it’s appropriate to take stock of how well the efforts are going to help the hurricane survivors rebuild their homes.

Karen and I had the opportunity to gather data and assess things in preparation for her testimony before the disaster response subcommittee of the US Senate Homeland Security Committee on May 20. I posted the video of her oral testimony to this blog yesterday. Her full written testimony can be found through a link on the committee’s website.

The bottom line is this. With the first round of Hurricane Rita funding, totaling $40.8 million a total of 223 homes have been built and an additional 240 manufactured housing units have been purchased and delivered. With the second round of Hurricane Rita funding, totaling $383.5 million a total of 23 homes have been completed with an additional 231 under construction. Of the $622.8 million set aside for rebuilding housing destroyed by Hurricanes Ike and Dolly no housing units have been built to date.

Needless to say these rates of housing reconstruction are extremely disappointing.

I get into the details of this below by quoting from Karen’s written testimony before the committee.

I preface my analysis with an overview of the CDBG disaster relief funding, which Texas has received and I will summarize the state’s housing related disaster accomplishments to date.

Texas has received three rounds of CDBG disaster relief funding, two rounds related to Hurricane Rita and the third related to Hurricanes Ike and Dolly.

Unlike some Gulf Coast states, Texas received a fraction of the amount of funds needed to address the housing and infrastructure damages sustained in this state.

With regard to disaster relief funding related to Hurricane Rita, in large part, Texas received inadequate federal funding because of FEMA’s under-estimation of the number of homes and extent of damages brought about by Hurricane Rita. FEMA reported that 11,195 Texas homes had “severe” or “major” damage due to Hurricane Rita.  However, the Governor’s office estimated that more than 75,000 homes had been damaged or destroyed. In addition, the governor estimated some 40,000 uninsured homeowners would need federal assistance to re-cover.

After the federal Administration’s second supplemental appropriations request only included funding for Louisiana, Texas Governor Rick Perry requested $2.017 billion in CDBG assistance including $367 million for housing.

Governor Perry also testified before the March 8, 2006 Senate Appropriations Committee hearing on the supplemental request, requesting $2 billion dollars in CDBG disaster recovery funding for Texas. Texas Senator Kay Bailey Hutchison pointed out that in addition to damages suffered as a result of Hurricane Rita, Texas had used its regular CDBG allocation to assist Katrina evacuees from Louisiana. The Emergency Supplemental Appropriations Act for Defense, the Global War on Terror, and Hurricane Recovery (P.L. 109-234), which became law in June 2006, included $5.2 billion in CDBG disaster assistance for the five states affected by the 2005 hurricanes. Congress left HUD to make allocation decisions between the states.  HUD allocated $4.2 billion to Louisiana and established a new methodology, in part because of pressure from Texas officials, to allocate the $429 million of the remaining $973 million to Texas.

Yet with the additional funds provided in the second round, Texas still had far too little money to address the housing needs of Hurricane Rita survivors, not to mention the Katrina evacuees who had moved to Texas. Even if all of approximately one-half billion dollars of funding in combined Round I and Round II appropriations had been directed toward housing, there would have been less than $7,000 to address each of the approximately 75,000 households impacted by Hurricane Rita.

Texas earmarked a substantial portion of Rounds I and II Rita funding to housing, a combined 84% of the available funds.

The following table indicates the funding levels from Rounds I and II and the funds set aside from each round to provide housing assistance.

Round    Total allocation    Housing funds    Housing percent
Rita I      $74,500,000        $40,885,181          54.9
Rita II    $428,600,000       $383,500,169          89.5

Lacking any experience in administering large-scale disaster recovery funding, Texas initially turned to regional consortia of local governments to administer the funds.

These consortia of local governments are known in Texas as Councils of Government (COGs).  The councils are comprised of representatives of cities and counties within particular regions of the state. Round I of the Hurricane Rita funding was administered under a program where the councils of governments in the disaster-impacted areas became grant subrecipients and developed and administered their own programs with oversight provided by the Texas Department of Housing and Community Affairs.

In the wake of long delays and inefficient administration of the Round I program by the councils of government, a new approach was taken to the administration of Round II funds. The state agency charged with operating housing programs, the Texas Department of Housing and Community Affairs (TDHCA), undertook to directly administer the housing disaster relief funds in the second round.

Rita II has been administered under a plan in which the state has not utilized subrecipients.  Instead the state administered the program itself, using a prime contractor (ACS) to manage the program, including intake, qualification, and construction management.  ACS has used two major subcontractors, Shaw Engineering to assist in construction management and Reznick to assist in benefit determinations.

Congress appropriated $1.3 billion in CDBG funds to Texas as initial funding to provide disaster assistance for Hurricanes Dolly and Ike. Texas Governor Rick Perry adopted a third different approach for the administration of these funds, designating the state Office of Rural Community Affairs (ORCA) to assume overall administrative responsibility under a plan which involves local communities in making decisions on where and how funds are utilized. The councils of governments make decisions as to which entities (including the councils of governments themselves, if they so elect) within their jurisdictions will be subrecipients and how the funds will be allocated between housing and non-housing activities.

The councils of governments elected to drastically reduce the percentage of funds for housing and to increase funding for infrastructure and economic development. Whereas under the Rita disaster assistance programs 84% of funds were earmarked for housing, the councils of governments earmarked a mere 47.9% of funding from the Hurricane Ike and Dolly disaster assistance funds for that purpose.

Round          Total allocation   Housing funds    Housing percent
Ike / Dolly I  $1,300,000,000     $622,752,828          47.9

All three rounds of funding have included provision for state-administered affordable rental housing set-asides, albeit at the minimum levels required by Congress.

ACCOMPLISHMENTS

The table below summarizes housing expenditures under each round of funding.

Program    Housing funds    Housing funds expended    % Expended
Rita I        $40,885,181         $27,258,022             66.7
Rita II      $383,500,169         $54,503,647             14.2
Ike/Dolly I  $622,752,828        
Totals     $1,047,138,178         $81,761,669

The accomplishments to date of the Rita I housing program administered by the councils of governments (officially begun in July 2006) is as follows:

Total rehabilitated/reconstructed    223
Total manufactured housing units delivered    240
Additional manufactured housing units ordered but not delivered    23
Additional houses under construction    24
Additional units out for bid          1
Total housing units    511

The accomplishments to date of the Rita II housing program administered by the Texas Department of Housing and Community Affairs (officially begun in April 2007) is as follows:

Total homes completed    23
Homes under construction      231
Closings     369
Total housing units    623

Plans for the Hurricane Ike/Dolly I funding have not yet been finalized.