Louisiana residents faced with having to pay back hurricane aid money because they failed to meet certain government requirements could get a break under changes the state outlined Wednesday.
NEW ORLEANS (AP) - Louisiana residents faced with having to pay back hurricane aid money because they failed to meet certain government requirements could get a break under changes the state outlined Wednesday.
The proposals from the state Office of Community Development would allow homeowners who have not made needed repairs or who have otherwise not met the requirements of the Road Home program to make the case that it was because of circumstances beyond their control.
Such circumstances could include delays due to contractor fraud, theft, vandalism, subsequent natural disasters or complications from contaminated drywall that was used in many homes after Katrina.
Road Home was established by the state following hurricanes Katrina and Rita in 2005 to provide federal grant money for repairing or rebuilding homes. Homeowners also were given the option to sell their houses to the program and relocate elsewhere in the state.
If homeowners can document the expenses they incurred from extenuating circumstances, those expenses will be subtracted from the amount of money they are expected to repay, the OCD said in a statement.
Another proposal addresses homeowners who used money earmarked for home elevation to make other repairs.
"The cost to elevate homes has increased substantially since the Road Home program began disbursing Elevation Incentive awards, and many homeowners did not have enough funds to complete the basic repairs needed to reoccupy their homes," OCD said. "As a result, some grantees used the elevation funds to complete their home repair or reconstruction."
Under the proposed changes, the amount of elevation funds used for home repairs would also be subtracted from the amount the homeowner owes the state.
There is also a proposal for a loan program for those who have not been able to complete repairs.
The proposals were announced a month after a state audit said Louisiana may owe the federal government more than $115 million for disaster relief aid that was misspent or awarded to ineligible recipients after hurricanes Katrina and Rita.
In a response letter to state auditors, OCD executive director Patrick Forbes wrote that his department is aggressively recovering money from suspected fraud cases and duplicated benefits. The department's priority, however, is to help people meet the guidelines and recover from the storms, Forbes said.
The proposals announced Wednesday would have to be approved by the U.S. Department of Housing and Urban Development.
Forbes said the state has been working with HUD to aid homeowners who have failed to meet guidelines through no fault of their own.
The state says it will gather public comment on the proposals through May 29, then will submit them to the federal government for approval.