Louisiana Sets Deadline For Storm Damage Claims

From The New York Times
By LESLIE EATON

The Road Home, the Louisiana grant program for homeowners who lost their houses to Hurricanes and Rita, is expected to cost far more than the $7.5 billion provided by the federal government, in part because many more families have applied than officials had anticipated.

The financial woes of the Road Home have set off a frenzy of finger-pointing between federal and state officials, who blame one another for the projected shortfall.

The new problem has reinforced the fears of many in that they are being abandoned by the federal government, even as it acknowledges that its levee system failed during Hurricane
''There's no way they can ever make everybody whole, but they need to fix the thing they broke,'' said Frank A. Silvestri, a lawyer and co-founder of the Citizens' Road Home Action Team, which has been critical of the program.

State officials say that many more houses turned out to have had severe damage than federal data indicated back when the program was created. They have also been surprised by a recent surge in applications, which are running at several hundred a day, almost two years after the storms, said Gentry Brann, director of communications for the program.

''Anecdotally, the companies aren't paying,'' Mr. Leger said. ''National Flood Insurance paid out, but private insurers didn't.'' Insurance benefits are generally subtracted from grants awarded by the program.

The Bush administration contends that the state itself created the shortfall by paying for home damage caused by wind, rather than limiting the program to flood damage. Insurance policies are more likely to cover wind damage than flood damage.

Even so, Mr. Powell ''is not opposed to additional funding -- if the state can make a clear case for more funds,'' his spokeswoman, Susan Aspey, wrote in an e-mail message. ''He wants to get this resolved as quickly as possible for the people of Louisiana, and he's indicated his willingness to sit down with the governor and her staff to work towards that end.''

Louisiana is also fighting the Federal Emergency Management Agency for more than $1 billion it was counting on for the Road Home program. FEMA says it cannot release the money -- intended for hazard-mitigation efforts like elevating houses -- because the Road Home discriminates against younger people by exempting people 65 and older from a requirement that grant recipients live in their rebuilt houses for three years.

A United States Senate subcommittee that held a hearing on the program last week is likely to recommend ways to fix it in a report to be released in June, said Stephanie Allen, a spokeswoman for Senator Mary L. Landrieu, the Louisiana Democrat who is chairwoman of the subcommittee.