Contaminated homes denied funds

It was one thing for Leatrice Roberts to find out that the government had sold her a townhome built on top of a waste dump. But it was mindboggling to learn, at age 74, that the Road Home can't buy her out because the land is contaminated.

"You talk to this one at Road Home, you talk to that one, nobody can tell you if she'll get her money," said Roberts' daughter Patricia, who now lives in Lakeview with her disabled mother and serves as her caretaker.

The state's $10.3 billion Road Home program pays homeowners up to $150,000 to rebuild their homes or to buy them out and transfer the land to a New Orleans redevelopment authority. Financing for the program comes from the U.S. Department of Housing and Urban Development, which currently runs HANO -- the same agency that decades ago built the Press Park complex where the Robertses' storm-damaged townhome is located.

In the past two weeks, state officials informed homeowners such as Leatrice Roberts who lived atop the old Agriculture Street landfill before Hurricane Katrina hit that their Road Home applications had been placed on hold indefinitely because they live on a Superfund cleanup site. The EPA in 1994 added the 9th Ward enclave to its Superfund list, but said the area could be made safe with mitigation steps such as the replacement of topsoil.

On Thursday, state spokeswoman Christina Stephens said state agencies were working with local leaders and the EPA to come up with a policy for using HUD financing to buy the properties on the Superfund site.

HUD said its money can't be used to purchase contaminated land, but that it would work with the state to come up with a solution.

Federal subsidies

Homeowners in the neighborhood argue that they are entitled to compensation when it was HANO and the city of New Orleans, backed by federal subsidies, that built the homes on an old city dump, placed public housing tenants there and sold the homes to poor residents in a rent-to-own initiative. The neighborhood included a subdivision development called Gordon Plaza.

HUD spokesman Brian Sullivan said the federal housing agency sympathizes, but doesn't consider itself a party to the dispute.

"We appreciate the fact that it must be a maddening situation for these homeowners," he said.

Late Thursday, Stephens said the state decided to put applications from former residents of the landfill neighborhood back into the Road Home pipeline. Blending elements of two Road Home options, the property owners would have their grants calculated based on a regular rebuilding grant, but they also would be allowed to use the money to relocate. She said the state was still working out details of the policy, including who would assume ownership of the properties.

"We can't keep these people in a holding pattern forever," Stephens said.

The land's hidden legacy

The Robertses believe they were the second family to move into the HANO Press Park complex when it opened in 1970. When HANO showed the widowed Leatrice Roberts the property, she recalls that nobody told her it was on top of the old 95-acre landfill, a city dump from 1909 to 1958 that briefly reopened after Hurricane Betsy in 1965.

Everyone in the neighborhood knew Roberts' Montegut Street townhome by the heavy door with "Roberts" in a gold-painted iron design in the middle. After Hurricane Katrina flooded the townhome and destroyed the roof, someone took that door.

Leatrice Roberts now uses a wheelchair because of heart problems, diabetes, high blood pressure and a blood clot in her lungs. She's been waiting for Road Home to buy her out since her first appointment in November 2006, and using her Social Security checks to pay $1,500 in monthly rent.

The property deed of Roberts, for many years a subsidized renter at Press Park, shows she purchased her townhome from HANO on Nov. 4, 1991, three years before the EPA found dangerous levels of lead in the ground and declared the area a Superfund site. A few years after that, Roberts and her other daughter, Gail Wells, were diagnosed with cancer, they said. Roberts lost a kidney and Wells had ovarian cancer, but both say they are now cancer-free.

During the same year that the site was added to the Superfund list, school officials shut down Moton Elementary School, across Abundance Street from the row of townhomes, citing fears of the health effects of buried waste. But local and federal officials at the time turned aside residents' pleas for a buyout of their homes.

Post-storm contamination

After Hurricane Katrina, when the EPA tested the ground in New Orleans and gave the city a clean bill of health, there was one glaring exception: In the old Ag Street landfill area, yards had 50 times the normal level of the cancer-causing petroleum byproduct benzo(a)pyrene.

Nevertheless, FEMA trailers were supplied for properties in the area. Road Home officially initially said the program would provide rebuilding grants, but not buyouts, in the area. And HANO told homeowners they could move back into their homes, even though a judge had called the neighborhood unfit for people.

Roberts is among hundreds of former Press Park and Gordon Plaza residents waiting for HANO and the city to pay a class-action judgment, in a suit sparked by pre-Katrina contamination issues. It took 13 years to win the lawsuit in Civil District Court, where Judge Nadine Ramsey declared the neighborhood "unreasonably dangerous" and "uninhabitable." She ordered HANO, the city and their insurers to pay fair-market value, plus amounts ranging from $4,000 to $50,000 for emotional distress, depending on how long a resident lived at the site before contamination was found in 1993.

On Jan. 30, the state's 4th Circuit Court of Appeals largely upheld Ramsey's ruling, although it cut the emotional distress awards in half. On Thursday, HANO appealed to the Louisiana Supreme Court and other defendants are expected to also press appeals, said plaintiffs' attorney Suzette Peychaud Bagneris.

Bagneris said she has asked the Road Home for more than a year to offer buyouts to the Ag Street landfill homeowners, just as the program has done for those affected by the Murphy Oil spill that occurred during Hurricane Katrina in St. Bernard Parish.

"Our requests fell upon deaf ears," Bagneris said.

Stephens said the Murphy Oil spill is not limited by federal rules governing Superfund sites. The Murphy Oil spill has its own section in Road Home policies. Until the state's decision Thursday, there had been no policy for Superfund sites.