Did Road Home treat all neighborhoods fairly?

It depends on how you look at it

Mortgage lender Carol Johnson has seen her clients and neighbors, mostly black middle-class folks, struggle to return to New Orleans from their post-Katrina exile, while the city's more affluent areas are buoyed by the sounds and sights of rebuilding.

Johnson believes the disparity has much to do with the way the Road Home relief program works. So she was angered but not surprised recently when she scanned a map produced by demographer Greg Rigamer, one showing how different parts of the city fared in the allocation of Road Home grants.

Reflecting about 40,000 Road Home grants in Orleans Parish through April 15, Rigamer's map shows the highest concentration of grants between $115,000 and the $150,000 limit went to residents of Lakeview, Lakewood and Eastover -- among the most expensive real estate in the city's heavily flooded neighborhoods. Eastern New Orleans, by contrast, has a high concentration of grants between $40,000 and $65,000.

The disparity can be traced, to a large degree, to a decision by the Louisiana Recovery Authority and federal housing officials to calculate grants based on a home's pre-storm value or an estimate of how much it should cost to rebuild it -- but mandating that the grant must be the lower of the two figures. In areas with modest-to-low property values before Katrina hit, the formula typically means a lower grant amount.

"This is discrimination based on the pre-storm value of a house," said Johnson, whose company serves mostly minority customers. "Someone in Pontchartrain Park can't rebuild, but you take the same property in Lakeview and you'd get a lot more money."

But the pattern that caught Johnson's eye doesn't tell the complete story. The assumption that the amount of Road Home grants should guarantee every homeowner the financial resources to rebuild is flawed, based on program rules. The federal government classifies Road Home as a compensation program, intended to combine grants with insurance proceeds to help homeowners recoup the pre-storm value of their home.

Federal officials were guarded about compensating homeowners well beyond that amount. If compensating homeowners for the pre-storm value leaves them in need of additional money to rebuild, the owners could try to cover the gap via a low-interest loan through the Small Business Administration. Road Home also allows an additional grant of up to $50,000 for residents in the lowest income brackets.

Looking solely at the average amount of Road Home grants by neighborhood also overlooks an important factor: The amount of money those homeowners originally paid to purchase homes in the city's more expensive locales. For example, it makes sense that a homeowner in Eastover would receive a larger compensation grant simply because that homeowner spent more money to buy a home in Eastover before the hurricanes. Moreover, the Eastover homeowner may still be in the hole because the grants are capped at $150,000.

Middle-income areas, including much of eastern New Orleans, were likely to receive the smallest Road Home grants because of the mix of modest property values and high rates of insurance coverage. And families in those neighborhoods typically found they made too much money to qualify for the low-income supplementary grants.

To determine how well the Road Home program has compensated homeowners for their losses, Rigamer's analysts at GCR & Associates Inc. analyzed average grants as a percentage of median pre-storm values in each neighborhood.

That data run showed that the program most fully compensated those in lower-income neighborhoods but fell short in covering homeowner losses in more affluent areas where losses typically exceeded the $150,000 grant limit.

The analysis shows:

-- Average Road Home grants were actually higher than the pre-storm values of homes in large swaths of poorer neighborhoods, places that served as the emotional touchstones of Katrina's wrath. The typical grant recipient in the Lower 9th Ward, St. Claude, St. Roch, the 7th Ward, Central City, Hollygrove and parts of Gentilly collected more than 115 percent of the neighborhood's median property value.

-- Residents in Lakewood, West End, Lakeview, Lakeshore and Lake Vista -- fully or partly flooded zones with high grant averages -- each received less than the citywide average of 68 percent of pre-storm value.

"It's the upper-priced homes that had the biggest gaps in protection," said Arthur Sterbcow, president of the Latter & Blum real estate firm and someone who has testified on Capitol Hill about New Orleans market challenges since the 2005 storms. "Lakeview, Eastover: These guys got the shortfall."

In Lakeview, many homes were enormously costly to repair, said GiGi Burke, a real estate agent who focuses on lakefront neighborhoods.

"It affected the very wealthy, too, and you don't hear too much about that," she said. "The bottom line is, they're losing a lot more money."

--- Less value, same costs ---

The Road Home grant figures don't provide a complete picture of who has enough to rebuild and who doesn't.

The unprecedented federally underwritten program was designed to work hand-in-hand with insurance payments and other government disaster aid to make homeowners whole, but the amount of insurance carried by homeowners varied widely. Without knowing insurance payouts, generalizations from grant data can be misleading.

But some trends are emerging as data become available from about 109,000 grants, valued at $6.4 billion. The impact of the program on rebuilding rates dates to Louisiana recovery officials' choice to use pre-storm values of properties as a key reference point.

While a home in Lakeview was worth substantially more before the storm than a home of comparable size in the Lower 9th Ward, owners of either destroyed home face similar costs, on a per-square-foot basis, in paying for materials, labor and other construction costs.

But when the U.S. Department of Housing and Urban Development classified the Road Home as a compensation effort instead of a rebuilding program, that drove how grants would be calculated. In a compromise designed in part to limit costs, federal and state officials agreed use the lower of a property's pre-storm value or a replacement cost of $130 a square foot for homes more than 51 percent damaged.

A 1,500-square-foot house totaled by storm waters in Lakeview, for example, might have been worth $250,000 before Katrina. In the Lower 9th Ward, a home of the same size may have been worth $70,000. But while the Lakeview owner's grant would be calculated on the basis of a $195,000 replacement cost, the 9th Ward owner's would be based on the much lower pre-storm property value.

If both homes had been covered by $40,000 in insurance, the Lakeview home would have qualified for the full $150,000 Road Home grant and the 9th Ward applicant would have been left with $30,000. The 9th Ward homeowner would have been fully compensated for the pre-storm value of the property, while the Lakeview resident would be short $60,000.

Both likely would need more money to rebuild, but the fully compensated 9th Ward homeowner would need more. Lower-income families can apply for loans to close the gap, but they typically face more difficulty qualifying.

The LRA recognized the potential problem and created an additional loan -- the state later made it a simple grant -- of up to $50,000 for those making less than 80 percent of the metro area's median household income. The U.S. Department of Housing and Urban Development sets the 80 percent limit at $36,500 for a family of two and $45,600 for a four-person household.

With the additional grant, it's possible for a low-income homeowner to collect up to $50,000 more, although the total Road Home grant still cannot exceed $150,000.

If the theoretical 9th Ward homeowner qualified as low-income, he or she could have collected a total of $80,000 from Road Home, more than the home's $70,000 pre-storm value.

"It shows the Road Home program was progressive in a way," said John Lovett, a law professor at Loyola University who has criticized the Road Home's design. "Maybe it was more generous than we give it credit for."

--- Grants affect return rate ---

That doesn't mean the program is generous enough to spur rebuilding.
Through April 15, 1,242 Lower 9th Ward families had received Road Home checks. That's more than 40 percent of the 2,975 owner-occupied units identified by the federal government immediately after Katrina flooded virtually every property in the area.

Yet nonprofit groups estimate that only 10 percent to 15 percent of families have returned to the Lower 9th Ward. They believe a key reason is the reliance on pre-storm property values in the Road Home formula.

Residents who gathered for a Lower 9th Ward workshop last weekend were eager to learn how to appeal for more Road Home money. Most left disappointed, realizing they couldn't buck the grant formula.

Robert Richardson inherited his 1,283-square-foot home on Caffin Avenue when his father died. Road Home officials informed him it would cost more than $166,000 to rebuild the home, under the $130-a-square-foot formula, but its pre-storm value was just $71,000. Even with a $50,000 low-income grant, Richardson said the resulting $92,000 Road Home award wouldn't get him close enough to the full cost of rebuilding.

"Three generations of my family owned that house," he said. "The formula makes it seem like it's fair across the board when it isn't."

One way Richardson could rebuild the home is to apply the $92,000 toward the cost and seek a $74,000 mortgage to cover the balance. Although he would be left making payments on a home he owned outright before the flood, he would own a completely rebuilt home presumably meeting stronger building codes than the dwelling that existed before the flood.

Road Home slows insurance claim payoffs

Richard Barker reached a $60,000 settlement for wind damage on a home near Six Flags on Dec. 12, but his eastern New Orleans client hasn't seen a dime of the insurance money five months later because the Road Home hasn't signed off on the paperwork.

Hundreds of homeowner insurance settlements are on hold because of a bottleneck at the Road Home program, and more are piling up every day, plaintiffs and defense attorneys say, because of the state's diligent checks to make sure that people aren't being overpaid and insurance companies aren't being subsidized.

"You can leave a voice mail once a day, and you're never going to get a return call. This is just an exercise in futility," said Barker, who plans to approach a judge with the insurance defense attorney on the case to see whether they can route around the grant program so the company can cut a check and close the claim.

As lawyers across the city grow exasperated, Soren Gisleson, head of the insurance section at the Louisiana Association for Justice, said several plaintiffs attorneys will meet with Louisiana Recovery Authority Executive Director Paul Rainwater and Office of Community Development Executive Counsel Dan Rees today to look for a way to break the logjam on insurance settlements.

"The problem is there's no time limit for Road Home to respond to the request," Gisleson said. "It's killing the homeowners. It's delaying all settlement checks."

Careful reviews required

Federal law requires Louisiana to make sure there is no duplication of benefits between Road Home grants and insurance payments. Although only additional insurance payments on structures are deducted from Road Home rebuilding grants, the program requires grant recipients to provide detailed information on any additional payments on structural damage, lost contents and displaced living expenses and send it to the state for a signature. If overpayments are discovered, the grant program must be repaid.

Recovery authority spokeswoman Christina Stephens said the state needs to review all of that information to watch for suspicious classifications of damage, such as putting everything on contents and living expenses to avoid having a grant reduced.

"They want to look at how the settlements are structured and to look at what funds are included in the settlement," Stephens said. "Sometimes we'll have questions for the insurance companies and questions for the homeowner."

The state Office of Community Development has six people working on the issue, two of them full time, and ICF International, the company that runs the Road Home program, has two people on insurance issues, one of them full time, Stephens said.

They have approved about 450 insurance settlements, and another 420 are pending, but the program is getting 10 to 15 new settlement approval requests a day as the pace of litigation settlements increases. "Our goal is to turn them around as quickly as possible," Stephens said.

Homeowners wait

The bottleneck is creating the unusual situation in which the grant program that was supposed to help homeowners is preventing them from collecting insurance coverage they paid for, in some cases even though the insurance settlement is worth more than the Road Home grant.

Barker's colleague, David Bernberg, has another eastern New Orleans case in which the Road Home gave his client a $600 grant, but won't sign off her insurance settlement of $55,000 in contents and $18,000 in additional living expenses.

While that type of case might set off a red flag with the recovery authority, from the plaintiffs attorney perspective, the settlement should just be waved through because there's no new money for structural damage that should affect the Road Home grant. "This poor lady can't get paid," Barker said.

While some note that every delay allows insurance companies to keep settlement money in their bank accounts, companies say they're eager to clear out Katrina claims.

"We've had some significant delays with getting settlements into the hands of our customers," said Phil Supple, a spokesman for State Farm, Louisiana's largest residential insurer. "I understand that they are woefully understaffed. We would be supportive of any efforts by the Road Home to resolve these issues to get settlements into the hands of policyholders."

Seeking a solution

To get around the Road Home inertia, some insurance companies have allowed homeowners to sign affidavits agreeing that they're responsible for repaying the Road Home if they collected too much money on their grants. In other cases, plaintiffs and defense attorneys are filing joint motions in court asking judges to declare that after, say, 30 days, the settlement can proceed without the Road Home's signature and the program will have to pursue any overpayments individually. Another idea has been to haul the Road Home into court for an answer and allow settlements to proceed if the program doesn't send anyone.

When plaintiffs attorneys meet with the recovery authority today, Gisleson said, they will ask the Road Home to allow homeowners to cash checks if the program hasn't flagged a problem in 30 days or accept settlements that have been approved by a third party such as a magistrate judge or a licensed mediator.

"We're talking about thousands and thousands of people" as settlements are reached, Gisleson said.

Texas firm taking over Katrina insurance cases

The Provost-Umphrey Law Firm based in Beaumont, Texas, is now representing about 200 policyholders whose disputes with State Farm were being handled by Dickie Scruggs and associated law firms.

Provost-Umphrey attorneys met with ex-Scruggs clients Thursday in Gulfport, said senior partner Bryan O. Blevins Jr.

"Hopefully, we can get this litigation back on track to benefit the clients and, ultimately, the courts," Blevins said Friday.

Scruggs had to relinquish the cases after he was charged in December with conspiring to bribe a North Mississippi judge. He subsequently pleaded guilty in the case. Once Scruggs was charged, State Farm asked a federal judge to dismiss other attorneys who had worked with him. A federal judge agreed to dismiss those lawyers, known as the Katrina Litigation Group.

Lexington attorney Don Barrett, who headed the Katrina Litigation Group, on April 18 wrote to the firm's 400 clients suggesting they hire Provost-Umphrey and also saying the new firm would be sending them contracts at Barrett's request.

Barrett said Friday he met managing partner Walter Umphrey during tobacco litigation. Umphrey's firm had represented the state of Texas during the 1990s lawsuits over what states spent on health-care costs related to smoking; Barrett had worked with Scruggs on Mississippi's case.

Umphrey's firm also subleases office space in Nashville from Barrett's nephew, who has a law firm there. Barrett is listed as an attorney with his nephew's firm. Barrett said he recommended the firm because it has the resources to handle the cases and Umphrey agreed to take them on, large or small.

Also on April 18, State Farm sent letters to Scruggs clients saying their attorneys had been disqualified and that any new attorney hired should contact one of the insurer's lawyers in Oxford.

The letter also said: "We would like to see if we can resolve any remaining issues without the need for further litigation" and gave policyholders a telephone number to call.

About 15 cases have since been settled out of the 178 the Katrina Litigation Group had pending in federal court. Barrett said the group had a total of 400 clients, not all of whom had filed lawsuits yet.

One couple who has settled with State Farm, Thomas and Ann Arnold, were plaintiffs in a racketeering lawsuit filed against the company by multiple policyholders. The lead plaintiff, Glenda Shows, has signed up with Provost-Umphrey, as have some other parties to that lawsuit.

Other policyholders have found their way to Coast law firms that handle insurance cases, some of whose members were miffed by the Katrina Litigation Group's decision to recommend a personal-injury law firm based in Texas.

Parish to start FEMA trailer lawsuits

After 16 months of administrative cajoling, Jefferson Parish officials said Tuesday that they will begin filing lawsuits this week against any persistent denizens of FEMA trailers.

Inspectors found 600 illegal trailers lingering in unincorporated areas during the weekend: 421 in West Jefferson and 179 in East Jefferson. That's down from a peak of more than 17,000 in the summer of 2006.

Parish attorneys will go to court Thursday with the first 30 lawsuits against property owners with FEMA-issued trailers on their land, Parish President Aaron Broussard's administration said. The process will continue until all trailers have been targeted.
The threat of lawsuits is the latest and most aggressive effort to date in the public campaign to return Jefferson's neighborhoods to their appearances before Hurricane Katrina.

"It's been long enough," said Kennith Lassalle, president of the Civic League of East Jefferson. "There may be a few people with extenuating circumstances, but not as many as there are trailers."

Soon after the Aug. 29, 2005, hurricane, the Parish Council suspended the law banning travel trailers in single-family zoning districts. By January 2007, parish officials were pressing to remove them, and code-enforcement inspectors started combing neighborhoods to post warning signs on trailer doors. As residents continued to rebuild their storm-damaged houses, the Broussard administration granted several extensions for the trailers' removal, then drew a line in the sand: March 1 was the deadline for the parish to begin considering lawsuits.

Kenner has taken a similar approach, with a deadline of May 31. After that, property owners could be subject to lawsuits, city officials say. According to the latest estimates, about 400 trailers remain in Kenner, down from a post-Katrina high of about 4,000.

Gretna this month counted 40 trailers, all but eight deactivated and awaiting FEMA pickup. Though its deadline for removing trailers was Jan. 1, residents could secure an extension if they could prove they were still repairing their houses. At last week's City Council meeting, Gretna officials said they will start issuing citations for remaining trailers in upcoming weeks.

Westwego has only a handful of trailers, and officials are pressing FEMA to remove them. The city has not renewed permits for residents with trailers.

A single trailer awaiting FEMA collection remains in Harahan, a city once home to about 200, Mayor Paul Johnston said.
In unincorporated areas, parish officials said any property owner who has asked FEMA to remove a trailer, but is still waiting for it to be hauled away, may avoid a lawsuit by submitting a signed and notarized affidavit to the parish attorney's office. Information about the process is available on the parish's Web site: www.jeffparish.net.

Lassalle, the Civic League president, said FEMA is partly to blame for trailers still in Jefferson Parish.

"At two of the trailers in my neighborhood, there's been no one living in them for eight or nine months, but FEMA just hasn't picked them up," said Lassalle, who lives in the Suburban Terrace neighborhood in Old Jefferson.
Parish officials said FEMA is trying to provide rental assistance and other help for trailer residents. FEMA's rental-resources phone number is (888) 294-2822. Its Web site is www.fema.gov.

Help also is available from the U.S. Department of Housing and Urban Development at www.hud.gov and (866) 373-9509.

Losing Our Will

wonder what the answers would be if each American asked himself or herself the question: “How is the war in Iraq helping me?”

While the U.S. government continues to pour precious human treasure and vast financial resources into this ugly war without end, it is all but ignoring deeply entrenched problems that are weakening the country here at home.

On the same day that President Bush was announcing an indefinite suspension of troop withdrawals from Iraq, the New York Times columnist David Leonhardt was telling us a sad story about how the middle class has fared during the Bush years.

The economic boom so highly touted by the president and his supporters “was, for most Americans,” said Mr. Leonhardt, “nothing of the sort.” Despite the sustained expansion of the past few years, the middle class — for the first time on record — failed to grow with the economy.

And now, of course, we’re sinking into a nasty recession.

The U.S., once the greatest can-do country on the planet, now can’t seem to do anything right. The great middle class has maxed out its credit cards and drained dangerous amounts of equity from family homes. No one can seem to figure out how to generate the growth in good-paying jobs that is the only legitimate way of putting strapped families back on their feet.

The nation’s infrastructure is aging and in many places decrepit. Rebuilding it would be an important source of job creation, but nothing on the scale that is needed is in sight. To get a sense of how important an issue this is, consider New Orleans.

The historian Douglas Brinkley, who lives in New Orleans, has written: “What people didn’t yet fully comprehend was that the overall disaster, the sinking of New Orleans, was a man-made debacle, resulting from poorly designed levees and floodwalls.”

We could have saved the victims of the Hurricane Katrina catastrophe, but we didn’t. And now, more than 2 ½ years after the tragedy, we are still unable to lift the stricken city off its knees.

Other nations can provide health care for everyone. The United States cannot. In an era in which a college degree is becoming a prerequisite for a middle-class quality of life, we are having big trouble getting our kids through high school. And despite being the wealthiest of all nations, nearly 10 percent of Americans are resorting to food stamps to maintain an adequate diet, and 4 in every 10 American children are growing up in families that are poor or near-poor.

The U.S. seems almost paralyzed, mesmerized by Iraq and unable to generate the energy or the will to handle the myriad problems festering at home. The war will eventually cost a staggering $3 trillion or more, according to the Nobel Prize-winning economist Joseph Stiglitz. When he was asked on “Democracy Now!” about who is profiting from the war, he said the two big gainers were the oil companies and the defense contractors.

This is the pathetic state of affairs in the U.S. as we approach the end of the first decade of the 21st century. Whatever happened to the dynamic country that flexed its muscles after World War II and gave us the G.I. Bill, the Marshall Plan, the United Nations (in a quest for peace, not war), the interstate highway system, the civil rights movement, the women’s movement, the finest higher education system the world has known, and a standard of living that was the envy of all?

America’s commanding general in Iraq, David Petraeus, and our ambassador to Baghdad, Ryan Crocker, went up to Capitol Hill this week but were unable to give any real answers as to when the U.S. might be able to disengage, or when a corner might be turned, or when a faint, flickering hopeful light might be glimpsed at the end of the long, horrific Iraqi tunnel.

A country that used to act like Babe Ruth now swings like a minor-leaguer. The all-American can-do philosophy has been smothered by the hapless can’t-do performances of the people who have been in charge for the past several years. It’s both tragic and embarrassing.

The war in Iraq stands like a boulder in the road, blocking progress on so many other important issues that are crucial to our viability as a society. We’ve seen this before. Lyndon Johnson’s Great Society, which included the war on poverty, was crippled by the war in Vietnam.

On the evening of April 4, 1967, one year to the day before he was assassinated, the Rev. Dr. Martin Luther King Jr. went into Riverside Church in Manhattan and said of the war in Vietnam: “This madness must cease.”

Forty-one years later, we can still hear the echo of Dr. King’s call. The only sane response is: “Amen.”

People who sold homes early still awaiting state money

Amanda Dumas is not the sort to feel victimized.

Sure, she has multiple sclerosis, a disease that is slowly destroying her muscles and making her more susceptible to illness, but she focuses on the fact that she's still ambulatory, still earning a living. Yes, her Meraux home and the homes of her extended family were destroyed in Hurricane Katrina, but most of them found homes on the north shore, near medical services they need. They've moved on.


Dumas wouldn't even dwell on the fact that she, her parents, her in-laws and other relatives had to sell their St. Bernard Parish houses at a loss. Except for one nagging thing: The Road Home program once promised to help make them whole, and nearly two years after the homeowner relief effort began, the state can't seem to make up its mind.

"They told us we qualified, then they said if they had money left over," said Dumas, a staff member for Taylor Energy in New Orleans. "Well, now they have $1 billion left over and they're still telling us we're in inactive status. It's outrageous."

The state recently determined it has $1 billion in the Road Home budget to restore an elevation grant program it suspended in April 2007. The latest budget estimates also show the state hopes to add hundreds of millions of dollars for other program costs. It also signals, at least for now, that $60 million is being reserved for homeowners who sold their properties early.

Many mixed messages

Of all the homeowner groups who have found themselves in Road Home limbo -- mobile home owners who had to clamor for inclusion, condo owners caught up in confused damage calculations, houseboat residents still seeking eligibility, those facing ownership succession issues -- nobody has been given more mixed messages than the 4,772 applicants who sold their homes before the aid program launched, or before they could make it through the grant decision process.

The group doesn't include thousands of homeowners who sold out in the first year after the 2005 storms and never applied for Road Home help. Details of their circumstances are unknown.

The original Road Home action plan, as approved May 11, 2006, addressed the applicants who sold out early.

"A homeowner that can demonstrate that he or she remains in a loss situation after selling the damaged property to another party may receive assistance under the program to compensate for remaining losses," the May 2006 document said.

Based on comments received during the past year by The Times-Picayune and homeowner advocates, these Katrina victims generally were elderly, disabled or both. They were desperate to sell, and willing to accept a low price, because they were the least able to wait the 10 months it took for the state to launch the Road Home -- or the three-quarters of a year longer it took, typically, to get from filing an application to landing a grant.

Many of them felt forced to leave devastated areas, but often reinvested in Louisiana. There's Peter Tesvich, for example, whose insurance and sale of his Meraux home in March 2006 left him about $40,000 short of recouping his losses as he rebuilds his life in Hammond. Or Hillary Brown, an 80-year-old veteran, who had to sell his Chalmette home in November 2006 for a paltry $29,000, and used his entire life savings to buy a new one in Covington.

They all seemed to be left with the same questions: If the point of the Road Home was to keep Louisiana homes in commerce and encourage storm victims to come back, aren't they prime candidates for grants? And, now that Road Home rules have changed to allow people to collect compensation and later sell their homes on the open market for additional funds, why doesn't it work the other way around?

In the summer and early fall of 2006, as the first applicants started trickling in for Road Home appointments, those who had sold under duress said they were told they qualified, no strings attached. They say that changed in 2007, especially after state officials reported the Road Home would be billions of dollars short of paying those who were rebuilding their homes or selling them to the state. On May 24, 2007, the phrase "subject to the availability of funds" was added to the action plan's section on sold homes.

Dream home lost

"At our appointment in November 2006, they told me as long as we relocated within Louisiana, we qualified and wouldn't be penalized," said William Nuckley, a disabled 74-year-old who estimated he faces a deficit of about $280,000. That estimate is based on application of the Road Home standard of $130 per square foot to his 5,000-square-foot "fortress" of a home in eastern New Orleans, less $263,000 he got from insurance and $106,000 from a private sale.

"Later on, they changed their tune and told us we were last and on the shelf somewhere."

Nuckley sold his Kenilworth East neighborhood home in June 2006, just as the Road Home was gearing up, because he was convinced by program staff and his reading of the newly minted action plan that he could still recover up to $150,000 of his losses.

He and his wife, Adele, were disabled when Katrina hit -- he had just recovered from bladder cancer surgery, she was suffering from heart trouble -- and they tried to ride out the storm. Floodwaters nearly killed them both, hurtling them across the house's interior when the garage door gave way. Their son pulled off a heroic swimming rescue, and a sturdy mattress was used to float Adele Nuckley to a nearby levee, William Nuckley said.

After that traumatic episode and the loss of the dream home he had built to his wife's exacting specifications -- and after a year of waiting for the state to finalize its recovery plan -- they felt compelled to sell, using their insurance proceeds and retirement savings to buy a new home in Destrehan. They expected a Road Home grant to arrive in due time. But the couple never thought they'd spend much of the next year and a half fretting over policy interpretations in an indecisive recovery program.

"We relive this in our nightmares," William Nuckley said. "My wife has crying jags every day. And I just want what's due us -- no more, no less. We worked all our lives. The American taxpayers decided we should have it, but now the politicians, they're just being frivolous with it."

Yes, no, yes, no

Last summer, as Louisiana leaders appealed to Congress for additional billions to keep the Road Home solvent, they left early sellers out of the equation, leaving the impression to many that the group wouldn't qualify for grants. But that changed again in November and December, when Congress came through with $3 billion for the Road Home and state officials announced it would be enough to cover all qualified applicants.

James and Charlotte Rhodes, who sold their Plaquemines Parish home in April 2006 at a loss, received a series of e-mails from Anita Anderson, the Louisiana Recovery Authority's constituent services specialist, that show the dizzying effects of the state's waffling:

--On Nov. 27, Anderson wrote: "At the outset, you were fully eligible to apply for Road Home assistance regardless of whether you sold your property on the open market. However, your application was in a 'holding pattern' to be considered for assistance later, if the budget allowed. Unfortunately, even after receiving the good news of the additional $3 billion in federal funds on the way to plug the budget shortfall, it has been determined there still is not adequate funding to serve homeowners in your situation."

--Then, on Nov. 30: "Persons who sold their homes without assigning the (Road Home) rights to a new owner are not eligible for the program. This has been the policy from the beginning."

--And on Dec. 18, the pendulum swung back: "Although current budgetary data appears to support the notion there may be adequate money in the Road Home budget to serve all homeowners currently in the program, it has not yet been determined whether there will be a SURPLUS. However, in the event there are excess funds available, we will take into consideration the possibility of making homeowners who sold their homes at loss eligible as we move forward in arriving at the budget certainty required to make definitive policy decisions on this issue."

On 'inactive status'

And this month brought the most confusing scenario yet. Applicants who sold their homes early received letters, dated March 12, stating: "Due to current budgetary constraints, it is unlikely that The Road Home will be able to provide funding assistance to homeowners who previously sold their homes."

But that very same day, the LRA, which oversees the Road Home, released budget projections that showed it was setting aside $60 million for sold homes. That would provide $12,610 for each homeowner if all made it through the process and the money were divided equally.

When asked about the apparent contradiction, LRA spokeswoman Christina Stephens said the budget isn't set in stone and the letters to applicants were only making official what's been true for months -- that these applicants have been placed in "inactive" status. That means, she said, that nobody at Road Home is working on their files, but they aren't out of the program entirely.

Dumas said the $60 million budget item was the first time she'd seen any kind of commitment to people who sold their homes early, so she was encouraged. But she said the letters upset her elderly parents, who lived in almost the same size house in Meraux and face a similar loss of about $38,000 when their insurance and sale proceeds are considered. They would benefit greatly even if they could recoup just $10,000 of the loss, Dumas said.

"My husband and I, we'll be OK," she said. "But I worry about the elderly and other disabled people who didn't have a choice."

Road Home set to revise appeals

BATON ROUGE -- State officials and the private contractor that runs the Road Home grant program will completely rewrite its appeals process for disgruntled applicants, according to the state's top recovery executive.

"We're starting with a blank sheet of paper," Louisiana Recovery Authority chief Paul Rainwater told the Legislative Audit Advisory Council on Thursday as he held up an unblemished sheet.

Appeals and "dispute resolutions" have been at the center of applicants' complaints about the state's $7.5 billion residential recovery program, which is under continued monitoring by Legislative Auditor Steve Theriot and now Inspector General Stephen Street.

"It's time to get this program done," Rainwater said, flanked by Road Home Chief of Staff Al Blankenship, an employee of contractor ICF International, which then-Gov. Kathleen Blanco selected in 2006 to run Road Home.

Blankenship echoed his commitment, and Rainwater called the former Marine "an honest broker."

It is not known how many homeowners' appeals the changes would affect, but it could represent a fundamental shift in the much-criticized program given that grant-seekers are allowed to challenge rulings at varying stages of their application process, from a denial of eligibility to the award amount.

$800,000 fine looming

ICF now is under threat of an $800,000 fine if it can't provide proof by May 8 that it has resolved pending homeowner disputes over grant amounts as it claimed to have done last year.

Rainwater and Blankenship did not offer details of what kind of changes they are considering for the state's residential recovery program.

But, making the first comments to lawmakers since last week's revelation that Blanco raised the spending cap on ICF's contract five weeks before she left office, Blankenship told lawmakers to hold him accountable for Road Home's performance.

"The buck stops with me," he said. "I take everything you say seriously . . . and I know how to get things done."

Rainwater said he expects in the next few weeks to get Theriot's and Street's findings after their examinations of the Dec. 7 contract amendment that increased the Road Home operating budget for ICF International from $756 million to $912 million.

Theriot's office is analyzing whether the increase, which would allow more compensation for ICF and its subcontractors, was appropriate. Street is examining who was involved in the process behind the decision, which was made five weeks before Blanco left office.

Rainwater said the contract will "be open for renegotiation" once Theriot and Street release their separate reports.

Auditor weighs in

Theriot, during his presentation to lawmakers Thursday, did not foretell the results of his analysis, but he said previous performance and compliance audits from his office noted that several policy changes to the program would result in increased costs.

That's when amendments to the contract should have been discussed, he said. "You don't issue change orders at the end of the process."

The contract, signed June 30, 2006, is a "time and materials" contract, meaning ICF's charges to the state are based on the numbers of applicants and numbers of varying tasks associated with those cases. The firm also takes fixed payments for travel and a management fee.

A penalty clause was added last year that would fine ICF if it failed to reach certain benchmarks.

To date, the state has received more than $600 million in invoices, including almost $13.7 million for travel and $8.6 million in management fees.

The December amendment bases the higher budget cap on the argument that ICF will pay out far more Road Home grants than originally expected. The document says the number increased from 100,000 to about 160,000.

Yet the program was launched expecting to pay more than 114,000 grants, and estimates for total grants have now dropped to as low as 128,000.

And, as lawmakers noted Thursday, the 103,679 grant closings that ICF has reported in its latest progress report includes homeowners who are still appealing for more money. Some applicants have reported program officials pressuring them to take that route.

The progress report says more than 184,000 applications have been processed, with 155,676 eligible applicants and $6.1 billion in disbursed awards.

Avenues of appeal

Theriot said he still is trying to find out how many of the cases involve ongoing appeals. Rainwater told lawmakers he did not have that number. An ICF spokeswoman referred questions about the number of appeals to the Office of Community Development, the arm of the state that has had direct supervision of the program. An OCD representative did not respond to The Times-Picayune's inquiry.

Besides the final award amount, applicants may appeal eligibility decisions; denial of additional compensation grants; prestorm home appraisals; damage estimates; and FEMA assistance or insurance payments deducted from the award amount, among other decisions.

Current policy dictates that appeals must be submitted in writing to the Road Home appeals office, but only after an applicant has attempted to settle the dispute through the Road Home Resolution Team or Post Close Grant Reconciliation Team.

The process also is particularly complicated for some applicants affected by a period of time when the program dealt with applicants principally via oral communication, leaving disgruntled homeowners lacking the necessary documentation for a written appeal.

After initially defending the oral communication policy as expeditious, the Office of Community Development and ICF agreed under pressure to establish a written record.

Study: Road Home grant process slow and unpredictable

Homeowners who sold their hurricane-damaged properties to the state through the Road Home program generally waited 100 days longer to receive their money than those who opted to get cash to rebuild, according to preliminary results of an independent study of the beleaguered grant process.

Owners of condominiums also faced grant delays, waiting about 50 days longer than owners of single-family homes and duplexes to receive their grants. Meanwhile, shorter -- but still significant -- lag times were faced by homeowners who carried wind and flood insurance, compared with those without coverage.

Researchers with the RAND Gulf States Policy Institute offered no conclusions as to why certain categories of homeowners waited longer for Road Home money. But their broad findings echoed what has been a familiar theme: The process of landing a Road Home grant is slow and unpredictable.

Highlights from the study were presented Tuesday during a meeting at the University of New Orleans of the Louisiana Recovery Authority's housing committee. They were among the initial results of a $49,000 "in-flight review" that the LRA commissioned in August. The LRA ordered the study to identify "points of delay and error introduction that inhibit the quality and efficiency of the program."

Wait time about 8 months

In reviewing thousands of applications that were moving through or had completed processing by Dec. 18, researchers pegged the median wait time for receiving a grant at 243 days, or about eight months. That means half the grant recipients waited less than that period and half waited longer, according to a two-page fact sheet distributed at Tuesday's meeting.

In some cases, the wait was far longer, researchers said.

"RAND found that although some applications have been processed in a timely manner, the timeliness of the grant-making process overall has not been consistently fast and predictable. Grant wait time has ranged widely, with some homeowners receiving grants in as little as two months and others waiting as long as 500 days," the fact sheet states.

Researchers relied on data provided by ICF International, the Virginia firm that could receive as much as $912 million for managing the Road Home program.

The study found that applications have not always been handled on a first-come, first-served basis.

"As of December 18, 2007, many thousands of eligible applications were still in progress, and some of these were among the earliest to enter the grant-making process," the document states.

Rick Eden, the report's principal investigator, said researchers reviewed 57,000 cases in which applicants had received money by mid-December and 79,000 others that were "active and eligible" at that time.

Eden said some delays were caused by homeowners who dallied in their decisions about whether to use Road Home money for a buyout or for rebuilding. But he said a review of data and of ICF's process showed that while the contractor pushed to meet monthly quotas for closings, it had little regard for the pace of individual applications.

"There were not necessarily goals that addressed the experience of each individual applicant," Eden said. "They had program goals."

In many cases, delays began the moment an application was sent to ICF, he said.

"A lot of applications got off to a slow start due to long initial processing time," Eden said.

Report leaves questions

Though rife with detail about the time that applications spend in the various stages between application and closing, the preliminary findings did not satisfy all housing committee members.

Melanie Ehrlich, co-founder of Citizens Road Home Action Team, said RAND focused too little on customer service.

"I'm most disappointed to see it's mostly focused on timeliness and not what matters right now to the applicants, which is quality closings," she said.

Walter Leger, the housing committee chairman, wanted to know whether the analysis identified any process changes that could be implemented immediately.

"What steps can we take to analyze right now what can be done in terms of resolving the more difficult cases?" he asked.

Eden, however, said RAND still was working into the report comments from members of the LRA and state agencies, ICF employees and others, and would not have a complete slate of conclusions or recommendations for at least a month. A peer review by other experts is still needed, he said.

"Please ask your peer reviewers to read fast," Leger said.

Despite requests from Leger and The Times-Picayune, researchers refused to release a copy of the detailed computer presentation displayed Tuesday, which included scores of charts and graphs breaking down application data by type of applicant and stage of the grant process. Data provided by ICF for the RAND analysis did not include any personal information about applicants, such as names or Social Security numbers.

RAND spokeswoman Lisa Sodders cited "corporation policy" in saying that RAND generally does not make public such "work product." She added that the think tank's release of preliminary details Tuesday was unusual, that such precise information is typically withheld until the writing of a final report.

Blanco defends Road Home firm's raise

Former Gov. Kathleen Blanco on Friday defended her decision in December to increase the Road Home contractor's maximum pay by 25 percent, even as Louisiana officials threaten the stiffest fines yet against the company for failure to prove it met a key performance standard.


The Office of Community Development has put the contractor, ICF International, on notice that it will be fined $800,000 if it can't provide more convincing proof by May 8 that it resolved homeowner disputes as it claimed to have done in July, August and December of 2007.

The pending fine, if assessed, would bring total fines against the company to $925,000. The fines would have reduced the amount ICF could earn from its promised maximum pay of $756 million, but just before the year ended, its pay limit, set by contract, was increased to $912 million. Its possible income from running the homeowner portion of the Road Home went up 25 percent, from $633 million to $789 million.

Key legislators and the Louisiana Recovery Authority's housing chairman, Walter Leger, said they didn't know about the raise until The Times-Picayune inquired about it Wednesday.

But on Friday, Blanco and her former commissioner of administration defended the pay raise, saying other state offices were involved in negotiations with ICF.

Repeated review

"It was my understanding and belief that any contract change would be publicly noticed," Blanco said in an e-mail message sent from France, where she's giving a speech to a flood-response conference. "I encourage Steve Theriot, the legislative auditor, whose office was consulted during negotiations, to continue to audit ICF and to hold them accountable for every dollar of their contract."

Theriot said he would begin dissecting the amendment costs immediately.

Jerry Luke LeBlanc, who acted as Blanco's representative in signing the contract amendment, said former LRA Executive Director Andy Kopplin and key legislative staff also were involved in calculating the amount of the increase and gave their approval.

"When I was brought the final contract (amendment) everyone was in agreement that this is the final amount," said LeBlanc, who left state government when Blanco left office in January. "LRA, OCD (Office of Community Development) and auditor folks, who took a look at a component of it -- they all analyzed the data. Before I would sign it, I wanted multiple elements to look at it."

Kopplin, who recently completed an unsuccessful campaign to fill an open congressional seat, was on vacation and couldn't be reached for comment Friday.

A quest for offsets

Kopplin's successor, Paul Rainwater, said the LRA's staff was notified at the time, but had no oversight of the contract and "urged the (the administration) to offset contract increases to the extent possible with reductions in other portions of ICF's contract, to aggressively manage ICF's labor costs to achieve savings or to increase the contract amount incrementally."

That wasn't done and now Rainwater, an appointee of Gov. Bobby Jindal who wasn't with the LRA at the time, is left to find ways to keep the costs from reaching the new $912 million cap.

"It is outrageous that ICF couldn't do the job for more than $750 million and that they were given a pay raise after their history of disappointing service," Jindal said.

Even Leger, still an LRA member and a self-described Blanco "fan," is baffled by the increase, given that many political observers believe difficulties managing the Road Home, Blanco's signature recovery program, played a lead role in ending her political career.

"It's just kind of surprising that this company that's partially responsible for her not seeking re-election gets treated this way," said Leger, whom Blanco picked to handle LRA housing issues.

Figures don't agree

In the amendment itself, the parties justify more money for ICF by saying it will pay out far more Road Home grants than originally expected. The document says the number increased from 100,000 to about 160,000. However, the program launched expecting to pay more than 114,000 grants and estimates for total grants have now dropped to as low as 128,000.

LeBlanc said the state had to pay the Road Home contractor more money "because ICF was going to have to either stop processing cases or it would trickle down to a snail's pace" because they "would run out of money to pay their subcontractors."

But when the amendment was signed in December, ICF, a publicly traded company, was wrapping up a profitable quarter in which revenue shot up 64 percent over that of the same period in 2006, mainly because of payments for running the Road Home program.

LeBlanc said staff for a key legislative audit committee asked OCD and LRA to come to a hearing a week after the amendment was signed to answer questions about the pay increase, but then never raised the matter at the meeting. He said Blanco administration officials didn't bring it up in that forum because they can only respond to committee questions.

While all that was happening, state officials were publicly expressing concern about homeowners' myriad complaints that Road Home staffers provided poor customer service, often failing to return phone calls, explain grant delays or resolve disputes. Rainwater says he remains worried about those issues.

He said that was the reason a new contract to handle FEMA elevation payments was not given to ICF and why he's asked Louisiana State University to conduct a customer service review.

"We are sending a letter to each employee of ICF concerning some of the ways they've talked to some of our people and treated some citizens," Rainwater said. "I expect people who have already gone through a lot to be treated with dignity."

Critics admit they didn't visit, research post-Katrina New Orleans

NEW ORLEANS | A United Nations panel will decide Friday whether the U.S. government's response to Hurricane Katrina violated a treaty on racism, and its ruling could be influenced by a controversial statement from two U.N. advisers who last week labeled the planned demolition of four New Orleans public housing complexes as "discriminatory" even though neither visited the city to research the issue.

Last week's statement drew international media coverage and was hailed by opponents of a plan to replace the four housing complexes with mixed-income neighborhoods, although the plan also calls for the Department of Housing and Urban Development to retain several other public housing complexes in New Orleans. HUD also has provided vouchers through which former public housing residents can rent private apartments across the city.

The U.N. specialists now acknowledge that they haven't been to New Orleans since Hurricane Katrina and were basing their opinion largely on the views of activists who have waged an unsuccessful campaign to halt the demolitions.

Miloon Kothari of New Delhi, India, the U.N. Human Rights Council's specialist on adequate housing, and Gay McDougall of Washington, D.C., the U.N. independent expert on minority issues, joined ranks with opponents of the demolitions already under way at the St. Bernard, C.J. Peete and B.W. Cooper complexes.

The statement implied that the demolition of public housing in New Orleans would end up "increasing poverty and homelessness," particularly for black hurricane victims. It called for more planning input from residents and former residents. It also dismissed the HUD plans as too slow and insufficient for the 5,000 residents of traditional public housing units displaced after the storm.

Local and federal public housing officials argue that public housing families who want to return are being served through traditional public housing or private apartments. And they say plans for a shift to mixed-income housing will better serve the families who remain.

World watching
Although the duo say they released the statement to influence the U.S. Congress, the timing of their comments could have broader influence.

The statement was released in Geneva, Switzerland, last Thursday, a day before a U.N. treaty enforcement panel -- meeting in the same European city but with no link to the two advisers -- was to discuss U.S. government responses to Hurricane Katrina. That committee is scheduled to decide Friday whether 12 nations, including the United States, are adhering to the International Convention on Elimination of All Forms of Racial Discrimination.

The committee isn't likely to go beyond a public shaming if it finds the United States in violation of the treaty, but even that step could be damaging. In the past, the panel has denounced Australia's policies toward Aborigines and genocide in the Darfur region of Sudan.

Kothari and McDougall's statement made the case that public housing plans in New Orleans amount to a violation of international human rights law. They say "the inability of former residents of public housing to return to the homes they occupied prior to Hurricane Katrina would in practice amount to an eviction for those who returned or wish to return." In telephone interviews, they later called for a one-for-one replacement of any public housing units that are demolished.

'I haven't studied it'
The treaty under review in Geneva, however, upholds only a right to adequate housing, not a right to return to the exact housing that was lost. When asked this week about the U.S. government's plans to continue providing apartment vouchers to displaced tenants while developers carry out a new model for public housing, Kothari demurred.

"Of course, if the situation is that people are arriving back to New Orleans and their housing is demolished, you have to provide alternative housing," he said. Asked whether the U.S. government is doing just that, he said: "I don't know. I haven't studied it."

Kothari and McDougall said their statement last week had nothing to do with the Geneva treaty review, but rather was part of their own attempts to engage U.S. authorities over recovery issues in New Orleans. They consulted with non-governmental organizations, or NGOs, some of which protested the demolitions in the city. But they acknowledged they had no feedback from the other side of the debate because federal officials didn't respond to questions they posed in December.

They said they were prohibited by U.N. protocol from going directly to Mayor Ray Nagin, the City Council or any other local or state officials.

"We haven't done a formal fact-finding in New Orleans. Some of our (U.N.) colleagues have, but we haven't," Kothari said in a telephone interview from his home in India. "The intention of our statement was to raise the issues, to say, look, these are the problems, and we expect a formal response from the (U.S.) State Department."

The colleagues he referred to include David Stanfield, who is crafting a U.N. report on land-rights issues after Katrina, and Walter Kaelin, the U.N. secretary-general's specialist on displaced people. Both have visited New Orleans recently.

Feedback questioned
The statement by Kothari and McDougall implied that the shuttering of public housing complexes has contributed to the growth of a homeless population in the New Orleans area now estimated at 12,000. But Kothari later said he has no evidence of that.

Also, the statement claimed affected families weren't meaningfully consulted about the demolition plans, but Kothari later acknowledged that some residents did meet with developers.

"Yes, some people were consulted," Kothari said, "but the fact that people's property was destroyed, the fact that not every unit is going to be replaced, the fact that there's an affordability crisis, and with the pressure HUD put on the City Council and the mayor -- that subsidies would be withdrawn if they didn't go on with the demolitions -- the question is: Has there been clear and informed participation in the redevelopment of the whole city?"

Kothari said letters from U.S. Housing and Urban Development Secretary Alphonso Jackson to Nagin threatening to cut off some federal subsidies if demolitions were halted amounted to institutional racial discrimination.

Federal and local officials reacted strongly last week to the pair's statement. Sen. David Vitter, R-La., called it "theater of the absurd."

HUD said Kothari and McDougall "are misinformed about the state of public housing in New Orleans," adding that the plans to demolish old, hurricane-damaged complexes is part of a wider effort to move to a mixed-income model that will help "minority and low-income Americans .¤.¤. live in a socially and economically integrated environment."

The New Orleans City Council said it approved the demolitions after hearing extensive public feedback.

Ruling coming Friday
The International Convention on the Elimination of Racial Discrimination will rule Friday on U.S. compliance with the treaty it joined in 1994. The ruling will be based on a report the United States provided in 2007.

In its report, the U.S. government argued there was no racial discrimination in the response to Katrina. It said the disparate effects of Hurricane Katrina on housing for minorities stemmed from poverty issues, not race.

U.S. activist groups responded by filing so-called "shadow reports" to the U.N. treaty panel. They argued that international law's standard for discrimination is not whether the government intends to discriminate, but whether the end result of its policies have a disproportionately negative impact on minorities.

Time runs short for Jeff trailer dwellers

After next week, Jefferson Parish will turn its caseload of residents who still have FEMA trailers over to attorneys who will start filing lawsuits to extract people from their emergency housing units.

The move marks perhaps the final major push in the parish's yearlong effort to eradicate trailers from front lawns and driveways. Calling for a post-hurricane return to normalcy, parish officials last year reactivated codes that prohibit trailers as permanent housing in residential neighborhoods. The restrictions include trailers provided by the Federal Emergency Management Agency, privately owned trailers and storage units.

March 1 is the deadline for residents to remove trailers from unincorporated areas of Jefferson before parish attorneys begin filing suits in 24th Judicial District Court. The parish will ask judges for orders compelling homeowners who are still trailer dwellers to comply with the zoning rules. Judges also could consider the arguments from residents that their houses remain unlivable with storm damage as they wait on contractors, insurance or money from the state's Road Home program.

Previously, residents had been able to win extensions from parish-hired inspectors and parish hearing officers as long as they could demonstrate that the people living in a trailer were the same residents of the household as before Hurricane Katrina and that they faced legitimate hardships in fixing their houses.

"This will allow a judge to make that determination," said Matthew Friedman, an assistant parish attorney handling trailer cases, about the new parish strategy of filing lawsuits. "It takes it away from the parish attorneys, the Parish Council."

Homeowners who have asked FEMA to take their trailers can avoid a parish lawsuit by filing an affidavit with parish attorneys indicating they have contacted the federal agency but are waiting for a crew to arrive. The affidavit also authorizes parish officials to call FEMA on behalf of homeowners and press for trailers to be hauled away.

"The affidavit is probably the new twist on this," said Bert Smith, deputy chief administrative officer for Parish President Aaron Broussard. "It puts the brakes on the lawsuit the parish attorneys would be filing."

Jefferson officials estimate about 1,500 trailers remain in residential neighborhoods in unincorporated parts of the parish, a count that has steadily dropped from more than 17,000 in the months after the 2005 hurricanes.

Officials have been urging people who still need housing assistance to contact FEMA about a rental assistance program now being run in conjunction with the federal Department of Housing and Urban Development.

The FEMA telephone number is (888) 294-2822.

To get a copy of the affidavit indicating that a homeowner has asked FEMA to remove a trailer, residents can visit www.jeffparish.net and click on the news release about the March 1 deadline. Residents also can pick up copies of the affidavit at the Joseph S. Yenni Building, 1221 Elmwood Park Blvd. in Elmwood, or the General Government Building, Suite 5200, at 200 Derbigny St. in Gretna.

FEMA Slammed for Using Toxic Trailers

FEMA, already a dirty word along the Gulf Coast, has taken another hit to its reputation.

The Federal Emergency Management Agency came under new withering criticism Thursday after tests found dangerous levels of formaldehyde fumes in many of the trailers the agency used to house hurricane victims in Louisiana and Mississippi.

''This is such gross incompetence. I really have not in my 10 years seen anything like this on the domestic front,'' said U.S. Sen. Mary Landrieu, D-La.

FEMA Administrator R. David Paulison said Thursday the agency would rush to find temporary housing for roughly 35,000 families now in its trailers. ''We're moving as fast as we can,'' he said.

The agency was forced to act after the Centers for Disease Control and Prevention reported that formaldehyde fumes from hundreds of trailers and mobile homes were, on average, about five times what people are exposed to in most modern homes.

Formaldehyde, a preservative commonly used in construction materials, can lead to breathing problems and is also believed to cause cancer.

Critics, already angered at FEMA for its performance after Hurricanes Katrina and Rita struck in 2005, faulted the agency for not responding sooner to concerns from storm victims that its trailers could be jeopardizing the health of occupants.

''It is simply inexcusable for FEMA to have a one to two year delay in addressing the serious health issues of these men and women along the Gulf Coast who have already suffered from the devastation of the 2005 hurricanes,'' said Louisiana Gov. Bobby Jindal, a Republican.

''When the health of our people and our children and our families is at stake we cannot afford to wait, we cannot decide that we have to do more studies and conduct further analysis,'' he said.

Paulison said he hoped to have everyone out of trailers and into hotels, motels, apartments and other temporary housing by the summer, when the heat and stuffy air could worsen the problem inside the trailers.

Louisiana has 25,162 occupied FEMA trailers and mobile homes, while Mississippi has 10,362, according to FEMA. Other states also have hundreds of trailers. At one point, FEMA had placed victims of the 2005 hurricanes in more than 144,000 trailers and mobile homes.

In an interview with The Associated Press after Thursday's briefing, Paulison acknowledged he could have done a better job of expressing sympathy for storm victims.

''I didn't want to get sappy out there in front of the cameras,'' he said, ''but the truth is that we really do care and we really are working hard to take care of the people's needs and get them out of these travel trailers and mobile homes.''

CDC Director Dr. Julie Gerberding said the center's tests could not draw a direct link between formaldehyde levels and the wide range of ailments reported by trailer occupants. But the CDC urged people to move out as quickly as possible.

Lynette Hooks, a trailer resident, was outraged at FEMA. Since she began living in her trailer outside her damaged New Orleans home in October 2006, she said she has suffered headaches and sinus problems, in addition to the asthma she had before.

''Am I angry at FEMA? Of course I am. They should have started moving people out of these trailers once they first started finding problems,'' said Hooks, 48.

The CDC findings could also have disturbing implications for the safety of other trailers and mobile homes across the country, Homeland Security Secretary Michael Chertoff said Thursday on Capitol Hill. But the CDC study did not look beyond the FEMA housing.

Paulison vowed that the agency would never again use the flimsy, cramped travel trailers to shelter victims of disasters. Mobile homes are generally roomier than trailers and considered less susceptible to buildups of fumes.

FEMA will press ahead with plans to supply leftover, never-used mobile homes from the twin disasters to victims of last week's tornadoes in the South, Paulison said. But the mobile homes will be opened up, aired out and tested first, he said.

State finds glitches on Road Home buyout list

BATON ROUGE -- The state agency that handles Road Home buyouts has made surprising discoveries during recent visits to more than 5,000 hurricane-damaged properties -- chief among them a smattering of dismayed homeowners who insisted they never sold their houses to the recovery program.

Contractors for the Louisiana Land Trust, which is responsible for landscaping and otherwise maintaining properties under the Road Home's control, also have stumbled upon lots still harboring occupied FEMA trailers, as well as some commercial buildings at the addresses provided in spreadsheets by the state's Office of Community Development, land trust Executive Director Nadine Jarmon said Tuesday. Commercial buildings aren't eligible for Road Home grants.

Glitches have arisen in about 5 percent of the 5,000 cases, and Jarmon traced the root of the problem to a more fundamental issue: Despite having to maintain buyout properties, the land trust has not received a single complete set of closing documents for any of the 5,161 properties that the state says it owns. Other problems could arise soon if the system is not streamlined, Jarmon told the Louisiana Recovery Authority board during its monthly meeting at Baton Rouge Community College.

Right now, we're basically taking their word that we own them," she said in an interview. "From here, the problem just kind of escalates, it dominoes."

The uncertainty about ownership status holds up various initiatives, Jarmon said. For instance, she said she has been working with federal officials to figure out whether the land trust can secure subsidies, either through FEMA's Public Assistance program or the Increased Cost of Compliance option of former owners' flood insurance policies, to cover some of the cost of demolishing buyout properties. Tapping either source would require proof of ownership, she said.

"For me, the big picture is you've got to be able to show ownership if you're going to advocate for any action on behalf of those properties," she said.

Documents in doubt

More important, without title documents, the land trust cannot turn over buyout properties to parish redevelopment authorities that are expected to return them to commerce, Jarmon said. Current estimates peg the eventual number of Road Home buyout properties in the range of 11,000 to 15,000, with at least 6,000 expected to end up in the hands of the New Orleans Redevelopment Authority.

"If we don't have our ownership documents, then there's something fundamentally wrong here," she said. "At some point, we just got to get it together."

A spokeswoman for the state Office of Community Development said that all sale and covenant documents for the transfer of Road Home buyouts are recorded at the parish level, while subcontractors handling closings for ICF, the state vendor running the grant program, are responsible for pulling together closing documents.

Spokeswoman GeGe Roulaine said that for the past several months, her department and ICF have been working with the land trust to put in place a computer system that will allow subcontractors to upload scanned images of all closing documents to a shared drive accessible by all parties. The process cannot be implemented fully, however, until the land trust finishes installing its own new computer system at its Baton Rouge offices, she said.

The land trust "did not want any paper documents. They wanted everything given to them only in digital," Roulaine said. "Until they're done developing their (computer management information system), we have to go with this temporary system of spreadsheets."

But in an interview, land trust consultant Terrie Walton responded: "Our computer systems are ready and our server is in place. We just need closing documents."
Rechecking information

Jarmon said the land trust is ready to accept the documents, adding that she has been lobbying quietly for access to complete closing records for the past three months. She is expected to make her case today at 10 a.m. during a hearing of the state Senate's Local and Municipal Affairs Committee.

In the meantime, Jarmon said she wants spreadsheets compiled by the state community development office to be scrubbed -- with a new check on the accuracy of the property status information.

"The issue has been (in) the accuracy of the information that we get from OCD," she said. "Right now we have properties (on our list) that have FEMA trailers on them. We have people who are still living on the property who say they were told at the closing that they can stay."

The land trust said it found 156 properties with FEMA trailers, some of which were occupied. It said it could find no lot to correspond with more than 40 addresses on the state spreadsheet.

Another OCD spokeswoman, Laura Robertson, said simple typographical mistakes likely are to blame for erroneous addresses on spreadsheets that led land trust contractors to properties that were not sold to the state through the Road Home. As for several residents who, according to Jarmon, told land trust contractors that Road Home officials said they could continue living at their properties after agreeing to a buyout, "that has never been our policy," Robertson said. "They have to vacate immediately."