There is new information about why the Federal Emergency Management Agency is forcing a Hurricane Katrina survivor to repay $12,000 in disaster aid, 12 years after the storm.
In response to WUSA9’s Special Assignment Unit report, FEMA is providing new details about what happened, and why it took the agency so long to tell the DC man at the center of this controversy: it wanted its money back.
Gregory Allen, Jr. is being forced to pay back $10,000 in disaster aid he received as a college student after he fled New Orleans after hurricane Katrina.
The government also tacked on $2,000 in penalties as a collection fee for a total of $12,203 in debt.
“FEMA decided that the funds that they gave me, I was ineligible for,” Allen said. “I lived through Hurricane Katrina but I’m in eligible for these funds. I lost everything, but I’m ineligible for these funds. I have PTSD, but I’m ineligible for these funds. I don’t even understand how they just arbitrarily chose this.”
We now know Allen, was not alone.
After our story aired, @MichaelHJordan tweeted that he had to pay back the $8,900 he got after Katrina. Another tweet came from @Nola_Darling84 who told investigative reporter Eric Flack she had to pay back around $20,000.
Others told similar stories.
Many were up in arms not just because FEMA wanted its money back but also that it took so long after the storm for them to collect.
Dee Love posted on the WUSA9 Facebook page: “12 years? Oh no, that’s on them. Things even fall off your credit after 7 years.”
The Special Assignment Unit spent weeks with Allen making phone calls and writing FEMA on Allen’s behalf to get an explanation.
At one point, Allen and Flack were on hold for more than two hours without ever getting through to a real person.
A day after Allen’s story aired, and in response to follow up questions, FEMA provided the most complete explanation to date about what happened.
Read the complete statement here.
FEMA says Allen, who moved to DC after Katrina, received something called Other Needs Assistance for personal property lost during the storm and flood.
In 2007, FEMA says it began an internal review of students in dorms who received those ONA funds. FEMA says it didn’t contact students who cases were under review to avoid unnecessary stress in the event those payments turned out to be proper. FEMA decided Allen’s payment was not although the reasons why remain unclear.
Meanwhile in 2011, Congress passed the Disaster Assistance Recoupment Fairness Act, or DARFA. It provided applicants, like Allen, the opportunity to have their debt waved. FEMA says it contacted everyone who was eligible to file a DARFA waiver by mail. But that window closed in September of 2012.
Allen missed it. Why?
He says he never heard a word about FEMA wanting its money back until earlier this year when a collection letter from the treasury showed up at his current address.
“You know like why are you going to give me this money if that’s an accident and you don’t really deserve it?” Allen said. “It was so painful I cried so much like I called the suicide hotline because I didn’t want to live anymore.”
In its statement, FEMA said “Earlier this year, FEMA implemented new internal recoupment review guidance to ensure that applicants who may owe a debt to FEMA are notified in a timely manner.”
That may help hurricane victims in Texas and Florida, but not Allen. FEMA says now that Allen’s debt has been transferred to the treasury for collection, FEMA cannot take any further action to review his case.
FEMA did say in rare instances, Treasury may agree to return a case to FEMA for additional review. The WUSA9 Special Assignment Unit is working with Allen to get that additional review.
Federal oversight offices said after Katrina, the amount of improper aid handed out was between $600 million and $1.4 billion. Although FEMA says it has reduced those figures in subsequent storms.
Read full statement here:
Federal law requires that applicants who are awarded disaster assistance funds in error must return the money to FEMA. In late 2007, FEMA began an internal review of students in dorms who had received Other Needs Assistance (ONA) personal property assistance during Hurricane Katrina. The purpose of this review was to identify cases in which personal property payments may have been awarded erroneously.
Multiple levels of staff and management conducted thorough reviews of each case in which it appeared that a student in a dorm had received an improper personal property payment. FEMA did not contact applicants whose cases were under review in order to avoid unnecessary stress and hardship for applicants whose payments were not determined to have been improper.
This review process was occurring while FEMA and Members of Congress were examining the impact that disaster assistance-related debts would have on Hurricane Katrina survivors. As these discussions were ongoing, case reviews were periodically put on hold while FEMA worked to determine the most appropriate course of action. As a result, some applicants were not notified of their debt until years after the initial review process began.
In 2011, Congress passed the Disaster Assistance Recoupment Fairness Act (DARFA) which provided certain applicants with the opportunity to have their debt waived. FEMA contacted, by mail, applicants whose debts could potentially be waived under the terms of DARFA. Because FEMA’s authority to waive debts under DARFA expired at the end of Fiscal Year 2012, Applicants who did not respond to FEMA’s attempts to contact them regarding a potential DARFA waiver had their debts certified to the FEMA Finance Center for debt collection.
The FEMA Finance Center contacts applicants by mail to inform them of their debt. If applicants do not respond to the FEMA Finance Center within 60 days, their debt is transferred to the U.S. Department of Treasury. Once a debt has been transferred to Treasury, FEMA cannot take any further action on the applicant’s debt. Applicants may contact Treasury to discuss debt repayment and, in rare instances, Treasury may agree to return the case to FEMA for additional debt review.
Earlier this year, FEMA implemented new internal recoupment review guidance to ensure that applicants who may owe a debt to FEMA are notified in a timely manner.