Federal money hasn’t reached disaster victims

Long after hurricanes, red tape leaves relief aid unspent

A man rides a bike in Loiza, Puerto Rico, after Hurricane Maria in 2017. The island’s nearly $20 billion in aid from a Department of Housing and Urban Development program has been mired in a clunky bureaucratic process. (Alex Wroblewski/Getty Images file photo)
A man rides a bike in Loiza, Puerto Rico, after Hurricane Maria in 2017. The island’s nearly $20 billion in aid from a Department of Housing and Urban Development program has been mired in a clunky bureaucratic process. (Alex Wroblewski/Getty Images file photo)
Posted May 22, 2019 at 5:00am

It’s been more than a year and a half since Hurricane Maria laid waste to Puerto Rico in September 2017, killing roughly 3,000 people and causing an estimated $90 billion in damages.

But federal money for any long-term rebuilding has yet to reach those in need in the U.S. territory, which was also battered by Hurricane Irma that same month.

The island is slated to receive nearly $20 billion in federal funding for long-term rebuilding under a program run by the Department of Housing and Urban Development. But the aid is delivered in piecemeal fashion, in what officials describe as a lengthy and cumbersome bureaucratic process.

And it’s not just Puerto Rico: similar problems with the HUD program have been reported over the years in disaster-stricken states like Texas, Louisiana, Florida and more.

Puerto Rico’s situation has been the focal point for the latest congressional dispute over a new round of disaster appropriations. The first slice of HUD aid for Puerto Rico, $1.5 billion, was made available only in February of this year, or 17 months after the disaster struck. And none of that money has actually been spent yet.

The aid could begin reaching victims in June as applications get processed, island officials say, barring unforeseen delays. But the need to wade through complicated regulations, combined with staffing shortages at both HUD and local offices, has made it a struggle for officials to get grant money out the door.

“It has been very frustrating,” said Fernando Gil Ensenat, secretary of Puerto Rico’s Department of Housing. “You’re dealing with a lot of components. And it’s even more frustrating when things hold you back and it’s not under your control.”

The slow pace of delivery has been frustrating for lawmakers, too, from both political parties. Democrats have accused the Trump administration of slow-walking the approval of aid, a claim officials dispute. Republicans grumble that Puerto Rico has yet to prove it can make effective use of federal aid, even as the island prepares to receive billions more dollars in long-term assistance.

“How do we know they need more when they haven’t come close to spending what we’ve already provided them?” Senate Appropriations Chairman Richard C. Shelby, an Alabama Republican, asked on the Senate floor.

But as federal auditors made clear in a recent report, Puerto Rico is hardly alone when it comes to slow delivery of long-term recovery aid.

Communities stricken by hurricanes, floods, wildfires and tornadoes across the country have faced similar delays in trying to jump-start federally funded rebuilding efforts.

Flashback: Menendez, Gillibrand call for Puerto Rico “Marshall Plan” on hurricane anniversary

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The Government Accountability Office, the investigative arm of Congress, painted a damning picture of HUD’s long-term aid program, known as Community Development Block Grant Disaster Recovery, or CDBG-DR. It portrayed an overwhelmed HUD office that lacked enough staff to properly monitor and evaluate grant applications. And it criticized the ad hoc nature of a program that has never been permanently authorized by Congress, requiring the issuance of time-consuming regulations after every disaster that can delay grant applications by months.

While Congress has allocated $35.4 billion for the HUD program since September 2017, almost none of the money has reached victims so far. The GAO examined the first slice of that pot that has been allocated to affected states and territories, amounting to $7.4 billion.

The conclusion: “Over a year after Congress first appropriated … funds for recovery from the 2017 hurricanes, grantees have generally not drawn down these funds to aid disaster hurricane victims because they continue to plan and design their activities.”

Texas, which had $5 billion allocated to recover from Hurricane Harvey, had spent less than $18 million as of January, the GAO found. Florida spent only $1 million of its $615.9 million allocation. And the U.S. Virgin Islands, which had nearly $243 million allocated, spent nothing, just like Puerto Rico.

“The process is not only lengthy, but confusing for everyone involved,” said Jeremy Kirkland, counsel to HUD’s inspector general, at a March hearing on the program held by the House Financial Services Subcommittee on Oversight. “We strongly recommend a permanent framework to bring transparency and efficiency to this program.”

HUD Secretary Ben Carson acknowledged the CDBG program’s shortcomings in recent congressional hearings. (Photo By Bill Clark/CQ Roll Call)
HUD Secretary Ben Carson acknowledged the CDBG program’s shortcomings in recent congressional hearings. (Bill Clark/CQ Roll Call file photo)

Regulatory quagmire

Since fiscal 1993, when the program was created, Congress has provided more than $86 billion in CDBG-DR money for long-term rebuilding. The funds can be used to buy up damaged properties, relocate displaced residents, restore damaged homes and rebuild public facilities, among other things.

But the program has operated for decades without any permanent regulations to guide the grant process. Instead, HUD must customize grant requirements after each disaster in Federal Register notices, which the GAO called “a time-consuming process that has delayed the disbursement of funds.”

In urging a change, the GAO called for a permanent authorization of the program that would allow for a standard set of regulations, cutting down the time needed by HUD to get grants moving. And the need for a better program will take on more urgency in coming years as climate change occurs, the agency said.

“The expected increase in the frequency and intensity of extreme weather events underscores the need for a permanent program to address unmet disaster needs,” the GAO said.

HUD Secretary Ben Carson acknowledged the program’s shortcomings in recent congressional hearings and appeared open to the idea of a permanent authorization. “Could that speed things up? The answer to that is yes,” he told the House Transportation-HUD Appropriations Subcommittee in April. “Does it take into account the individual nature of disasters? The answer to that is no.” But he said he was willing to find a way to “amalgamate the two to come up with a better system.”

Carson also told Senate appropriators that he had created a task force at HUD “to look at inefficiencies and ways that we can cut down” on delays in various grant programs. “There are some areas where we get things done in a day or two and other areas where it takes months,” he said. “And I find that to be unsatisfactory, and I think you’re going to see a big change in that.”

A devastating year

The 2017 hurricane season was particularly severe, affecting the lives and fortunes of nearly 26 million people, by GAO’s estimate. Hurricanes Harvey and Irma marked the first time two Category 4 hurricanes hit the continental U.S. in the same season. And Maria was the first Category 4 hurricane to make landfall in Puerto Rico in 85 years. The price tag for damages in all three disasters was $265 billion, according to the National Oceanic and Atmospheric Administration.

Even now, the damage can be haunting. “You can still see the impact on houses that have never been repaired,” said Jeronimo Candela, director of the Puerto Rico office of Mercy Corps, which helps coordinate aid and works with residents on ways to prepare for future disasters. “There are still many houses to be rebuilt. We are talking about thousands for sure.”

In Texas, too, time has done little to ease the suffering of those still breathing in mold or living in homes with tarps over missing roofs that don’t always keep the rain out. Some residents avoid parts of their homes entirely because of structural concerns.

“That’s how they live,” said Allison Hay, executive director of Houston Habitat for Humanity. “It’s like camping out in their house.”

But Carson insisted there has been no administration effort to hold up funding, for Puerto Rico or elsewhere. “I hope we can put an end to that rumor at this stage,” he told House appropriators.