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Experts See “Uneven” Housing Recovery in Gulf Coast

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NEW ORLEANS — Nearly four years after the devastation of Hurricane Katrina, housing for the Gulf Coast’s most vulnerable residents remains scarce and continues to mar other significant progress made in the region so far, experts told a Congressional field hearing yesterday and today.

While community groups and local leaders have made enormous strides in rebuilding and reclaiming many neighborhoods throughout the Gulf Coast, federal and state aid programs — most notably the Road Home program — have failed to live up to their promise.

“The progress of housing recovery at the community level has been very uneven and has led to racial and social inequities,” Dominique Duval-Diop, senior associate in the PolicyLink office in New Orleans, said at Thursday’s hearing. “We may have missed the opportunity to create sustainable and resilient communities — communities that are able to initiate and invest in their own recovery and redevelopment.”

The Congressional field hearings are being conducted by Rep. Maxine Waters, chairwoman of the House Financial Services Subcommittee on Housing and Community Opportunity. The hearings will continue place today at Lawless Memorial Chapel, Dillard University, 2601 Gentilly Boulevard, New Orleans.

Other experts who testified included:

  • Davida Finger of Loyola Law Clinic
  • Allison Plyer of the Greater New Orleans Community Data Center
  • Laura Tuggle of Southeast Louisiana Legal Aid
  • James Perry of Greater New Orleans Fair Housing Action Center
  • Cynthia Wiggins, a public housing resident
  • Angela Patterson of Unity of Greater New Orleans
  • Anita Sinha of the Advancement Project

The experts look at a wide range of issues, including:

  • The difficulty homeowners faced in navigating the Road Home program
  • Significant New Orleans rent increases since 2005
  • Ongoing difficulty for elderly, disabled, and low-income households who formerly lived in HUD-assisted homes that have still not been replaced
  • Fair housing violations that are prevalent post-Katrina.
  • The growth in the homeless population from 6000 to 12,000 since Katrina.

In 2007 and 2008, PolicyLink undertook major studies of the three major housing rebuilding programs: the Road Home homeowners program; the Multifamily Rental Program (funded through Low Income Housing Tax Credits and Disaster CDBG funds); and the Small Rental Repair Program.  Significant challenges remain in each of those programs.

In particular, the Road Home grant formula has had a more negative effect on those whose damage estimates were higher than their home value. Those whose damages were greater than their pre-storm home value - 47.3% of all applicants rebuilding in place - fell on average $69,000 short of the money they need to rebuild.

This was a particular problem in low-income, predominantly black neighborhoods in New Orleans. More than 60 percent of households in New Orleans East and the Lower 9th Ward have gaps over $40,000, compared to 49 percent citywide and 33 percent statewide. The average rebuilding cost gap for those communities were $65,000 and $68,000, respectively — a mammoth sum for low-income residents struggling to come home.

But insufficient government programs are far from residents’ only concerns, Duval-Diop says.

“Many recipients face insufficient rebuilding grants, contractor fraud, a high-cost environment, inability to access additional credit, and home-title succession challenges that delay or deny funding for the home repair.,” she said. “Our analysis found that the

majority of homeowners choosing to rebuild in place did not have sufficient resources to fully recover their homes.”

For more information on Gulf Coast rebuilding, please visit www.PolicyLink.org

Written by Dan Lavoie

August 21st, 2009 at 2:48 pm