HUD pushes Governor to redirect hurricane rebuilding funds to hurricane impacted counties

Things did not slow down during the holidays over the shape of Hurricane Ike and Dolly rebuilding programs in Texas, but my blogging did.

This update recounts what has been happening.

The concerns we have been raising for the past two years came to a head as the State of Texas moved to request an amendment to the State’s existing plan to administer federal CDBG funds for Ike and Dolly. HUD has approved the State of Texas Round 1 plan for $1.3 billion. The State of Texas proposed an amendment to that plan to allow it to spend the remaining $1.7 billion.

I have blogged extensively on our concerns about the approach Texas is taking to disaster recovery. The problems are basically: 1) the Texas plan divides the money up regionally in a manner that diverts money from Gulf Coast counties that had hurricane damages to areas that had little to no storm damage; 2) not enough of the money is going to repairing and rebuilding people’s homes; 3) the decision to allow eighteen different government organizations to administer the program is inefficient and treats storm survivors differently across different geographical areas; 4) the housing needs of the poor are not prioritized; 5) funds are not targeted to principally benefit low and moderate income persons as required by federal law; and 6) no consideration is given to overcoming barriers to fair housing in the administration of the program.

Here is what has unfolded over recent weeks:

On October 28 Texas Appleseed and TxLIHIS filed a complaint with HUD over the State of Texas proposed plan. Our concern is that Galveston, Harris and Orange Counties were grossly underfunded in order to direct funds to counties that had little or no actual hurricane damage.

TxLIHIS also filed an extensive fair housing complaint with HUD over the Texas plan.

On November 10 HUD sent a letter to Governor Perry rejecting the state’s proposed plan for the expenditure of $1.7 billion in CDBG disaster recovery funds. Governor Perry responded with an angry letter on November 16.

HUD’s response was a detailed objection to the Texas plan for allocating the money on December 18. HUD has done their own analysis of the regional disaster recovery needs that generally reflects the Gulf Coast Interfaith research and the claims Appleseed and TxLIHIS made in our complaints to HUD.

HUD’s letter responding to Governor Perry of Dec 18 speaks for itself. HUD points out Texas has expended less that 2% of the first round money and needs to revise its regional funding allocation for Round 2. HUD’s analysis shows the massive underfunding of the counties of Galveston ($1.087 billion in unmet housing and business needs) , Harris ($731 million in unmet housing and business needs) and Orange ($340 million in unmet housing and business needs). The State’s plan took money away from these three storm devastated counties to redirect funds to counties that had little to no hurricane damages.

The basis for the overall allocation of $3 billion in disaster assistance to Texas by Congress was the formula using FEMA and SBA damage reports to calculate unmet recovery needs. This is the same methodology that HUD used in it’s December 18 letter to Governor Perry. The State of Texas chose not to use any objective damage data but to come up with it’s own weather-based model for allocating the funds regionally. The State is wrong and HUD is right.

At stake is over $1.7 billion in desperately needed assistance to Texas families to repair their homes.