Maxine Waters Slams Mississippi Gov. for Abusing Katrina Aid Money

From the Gannett News Service

House Democrats on Thursday questioned Gov. Haley Barbour's use of billions of dollars in Hurricane Katrina recovery grants, saying too little was done to rebuild low-income rental housing and help low-income homeowners. "Frankly, I'm not convinced that the state has met all of its housing needs," said Rep. Maxine Waters, D-Calif., chairwoman of a House Financial Services subcommittee on housing. Waters said she called Thursday's hearing partly in response to Barbour's plans to use $600 million in Housing and Urban Development block grants to repair and enlarge the Port of Gulfport. The money was part of $5.4 billion Mississippi received in block grants.  Waters and other Democrats on the housing panel also questioned why Mississippi didn't use more of the grant money to break ground on low- and moderate-income housing and to help low-income homeowners whose losses from Katrina weren't covered by insurance. But besides asking tough questions, there's probably little lawmakers can do to hold Barbour, a Republican, accountable for how the grant money was spent.

When Congress approved the money in 2005 and 2006, it gave Mississippi and other Katrina-hit states wide discretion in using Community Development Block Grants. It's unlikely Congress can redirect the use of those funds now.

Mississippi has offered homeowners two grant programs. One has provided an average $70,000 to Katrina victims who had homeowner's insurance but no flood coverage. That program has doled out about $1.2 billion.

A second program aimed to help low-income homeowners who lacked insurance of any type. That program has disbursed about $278 million in grants.

HUD has expressed concerns about using the housing grants for purposes other than providing shelter for low and moderate-income families. But the agency said it was required by Congress to approve Mississippi's $600 million diversion from a housing grant program to the Port of Gulfport.

"Congress clearly indicated that HUD should not dictate uses of funds of the amounts set aside for each activity," Stanley Gimont, director of HUD's grant program, told lawmakers Thursday.

Jack Norris, director of Barbour's Office of Recovery and Renewal, said Mississippi diverted the money to the port because the state has enough federal housing money and needs a "balanced, comprehensive recovery" that includes economic development to create jobs.

"A rising tide lifts all boats," Norris said.

Rep. Al Green, D-Texas, countered that, "A rising tide does lift all boats -- if you have a boat."

He asked Norris to provide him with audits of the Port of Gulfport's finances in 2007 and 2008.

"I do not want to see money directed from needy people to the port," Green said.

Norris also said federal environmental rules have stymied Mississippi's attempts to use its HUD grant money to build nearly 3,400 housing units for low-income families. Those rules require time-consuming surveys of sites in Hancock, Harrison, Jackson and Pearl River counties.

"We're ready to go," Norris said. "The environmental process is holding us up."

Reilly Morse, an attorney with the Mississippi Center for Justice, testified that the state's plan would not provide enough money to replace storm-destroyed rental units and low-income homes.

He also said homeowners who lived a few miles inland and were more likely to be black had no way to apply for housing help. Morse said homeowners who lived further from the coast were more likely to suffer damage caused by wind, but Mississippi's program only compensates homeowners for uninsured flood damages.

"They lived on the wrong side of the railroad track and that's unfair," Morse said.