The money represents some of the federal funds aimed at helping the state recover after Katrina that have not yet been spent
Disaster recovery money intended to provide subsidies for first-time home buyers is being redirected to the Mercedes-Benz Superdome, state officials told lawmakers Monday night. The money represents some of the federal funds aimed at helping the state recover after Hurricane Katrina that have not yet been spent.
The decision to send money to a stadium rather than provide it to homeowners, and the slow pace with which money is still being provided to residents, fueled the ire of members of the Select Committee on Hurricane Recovery.
"Why would Superdome operations or capital be more important than getting people back in their homes to the government?" asked Sen. Karen Carter Peterson, D-New Orleans. "Help me understand that prioritization."
The decision to spend the money on the stadium, rather than keeping it in home-ownership programs prompted Rep. Jared Brossett, the chairman of the committee, to call for a meeting with federal government officials to discuss how the money was being spent.
"I believe there's a lot of people in New Orleans and the region who would take advantage of a soft-second mortgage," said Brossett, D-New Orleans. "The need is there."
Pat Forbes, the director of the state's Office of Community Development, noted that out of $13 billion in disaster assistance, $10 billion has gone to housing programs. The program is not intended to be solely for housing, he said.
"There's a breakdown of funds between housing, infrastructure and economic development," Forbes said. "You could go to any single program and argue that funds should be spent in some other place."
Peterson said the decision was particularly galling that Gov. Bobby Jindal has turned down federal money for rail projects and other improvements in Louisiana.
"Repeatedly, this administration has said 'no' to federal dollars -- but today they said 'yes' to federal dollars to repair the Superdome," Peterson said.
The Superdome money comes from about $75 million that was earmarked for soft-second mortgages, loans that are given to first-time homeowners that can be forgiven if the resident stays in the house for a set amount of time.
"If it comes down to sending money to the Superdome or putting people back into their homes, that's an easy call to me," said Sen. Edwin Murray, D-New Orleans.
The exact use of the money was contested during the meeting. Peterson and Murray said they'd seen documents saying the money would be used for operations, but Forbes maintained that the money would go to paying off the cost of repairs to the building that was not covered by FEMA.
Forbes said the money was unrelated to last week's announcement that the state would make $50 million in improvements to the New Orleans Arena as part of a 12-year lease agreement with the New Orleans Hornets. Both the Arena and the Superdome are part of the state-owned Louisiana Stadium and Exposition District.
During the heated meeting, committee members also grilled officials about the Home Elevation Grant Program, calling for answers as to why Jefferson Parish received a larger share of the money than New Orleans and St. Bernard. Craig Taffaro, who now runs the program, said he believed residents in Jefferson Parish were better poised to take advantage of the opportunity.
Members of the committee also noted that there is still $172 million in Road Home money that has not been distributed, an issue that Forbes said was because the federal government has not released the funds to the state.
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Jeff Adelson can be reached at jadelson@timespicayune.com or 225.342.5207.