The U.S. Department of Housing and Urban Development rejected the state’s plan to allocate the second round of $1.7 billion in federal disaster recovery funding, sending Texas officials back to the drawing board.
According to a Nov. 10 letter from HUD Assistant Secretary Mercedes Marquez to Gov. Rick Perry, some of the federal government’s chief concerns were that:
• Texas did not provide enough opportunities for residents to comment on the plans to spend disaster money on housing and infrastructure;
• The state did not update its plan to promote fair housing;
• The state’s plan is too heavily focused on mitigating future disasters instead of restoring infrastructure and housing; and
• The plan did not describe how Texas plans to allocate funds to units of local government.
More importantly to Galveston, the federal housing department objected to the state’s failure to update its plan to promote fair housing, even though Hurricanes Katrina, Rita, Ike and Dolly combined with a nationwide economic meltdown changed the landscape for low-income families.
The state last updated its fair housing plan in 2003. Citing the heated opposition in Galveston to rebuilding public housing, Marquez reminded the city and state that fair housing standards must be followed in the allocation of federal Community Development Block Grant funds.
The department supports rebuilding public and affordable housing in Galveston, particularly for low-income families, Marquez said.
45 Days To Fix Problem
The housing department gave the state 45 days to rectify the problems and resubmit its plan.
The delay shouldn’t be a problem since there is “compelling need to immediately approve the state’s plan” because Texas has yet to award about one-third of the $1.3 billion the federal government allocated to the state in the first round of disaster recovery funding, Marquez wrote.
‘Insult To Every Texan’
Perry blasted the federal department for rejecting the state’s application and accused federal officials of playing politics with the funding decision.
“HUD’s comment is an insult to every Texan whose home or business was destroyed or damaged by hurricanes Ike or Dolly,” Perry said in a prepared statement. “Hurricane Ike was the costliest storm in history to strike Texas, and this process should not stand in the way of assistance to disaster victims.”
Perry said the department’s rejection would cause months of delays because Texas does not plan to update its fair housing practices before February.
But officials with area agencies charged with doling out the federal dollars to Galveston County hurricane victims said they don’t think the rejection will delay area recovery efforts.
“I don’t know that a delay of a few days is going to have any real world effect,” Jack Steele, executive director of the Houston-Galveston Area Council, said. “It’s very premature because we’ve haven’t gotten the first round of funding out yet.”
The first Galveston residents likely won’t get the dollars to make repairs to their houses with federal funds before January or February. Galveston County residents will have to wait even longer.
Complaint Was Filed
The department’s complaint won’t prevent Galveston and Galveston County from spending round-one funds, Joe Higgs of Gulf Coast Interfaith said.
The department’s decision comes just days after an Austin-based social justice advocacy group complained about the state’s plan because Texas is not allocating enough money to poor- to moderate-income families to repair their hurricane-damaged houses.
In a formal complaint, Texas Appleseed claimed that Texas’ plan to spend the second round of money allocated for Hurricane Ike recovery does not meet federal requirements, specifically because it allows regional councils of government to decide how federal disaster recovery dollars are spent.
Those regional councils, including the Houston-Galveston Area Council, are not spending enough money on housing for low- to moderate-income families, staff attorney Madison Sloan said.
The U.S. Department of Housing and Urban Development did not respond immediately to questions about whether the Texas Appleseed complaint prompted the department’s letter to Perry.
Department spokesman Brian Sullivan said he could not comment beyond what was in Marquez’s letter.
Higgs said HUD’s complaints allow his organization to work to ensure that funding goes for housing restoration first.
