HUD withholds billions in disaster aid for Puerto Rico again - Affordable Housing Online

HUD withholds billions in disaster aid for Puerto Rico again

By on December 11th, 2019

Tagged As: Affordable Housing News, Editorials

Flooded area in Carolina, Puerto Rico, after the path of Hurricane Maria in the island. Photo by Sgt. Jose Ahiram Diaz-Ramos on U.S. Department of Agriculture profile on flickr.com.

The U.S. Department of Housing and Urban Development (HUD) has again left Puerto Rico without critical disaster aid approved by Congress. HUD has delayed $8 billion in disaster mitigation funds from reaching the territory. This follows a delay three months ago on another $10 billion in aid funding. To date, Puerto Rico has only received $1.5 billion of the $20 billion that Congress provided to rebuild after Hurricane Maria’s devastation. 

The funding that’s being withheld is from HUD’s Community Development Block Grant-Disaster Relief program. The program is the federal government’s key source for communities rebuilding after natural disasters. These funds pay for projects that will help communities withstand future disasters. They can be used for things like upgrading infrastructure, hardening electrical grids, or rebuilding homes, businesses, roads and bridges.

HUD failed to provide Puerto Rico with instructions to apply for its CDBG-DR funds when it issued a funding notice in the first week of December. Without the application instructions, Puerto Rico cannot begin the process to access its disaster aid. This follows on the heels of HUD excluding Puerto Rico from an early September funding notice for an earlier round of aid. In both cases, HUD missed deadlines imposed by Congress when it approved the disaster funding. In both cases, all of the other states that had funds allocated by Congress received their funding notices.

HUD officials were questioned in October by members of the House subcommittee that oversees HUD appropriations. The subcommittee wanted to know why HUD missed the funding notice deadline in September. The officials tried to justify withholding the disaster rebuilding funds from the territory because of “alleged corruption,” “fiscal mismanagement,” and “Puerto Rico’s capacity to manage these funds,” according to two HUD officials

U.S. Representative David Price (D-NC). Photo by price.house.gov.

Representative David Price (D-NC), Chair of the subcommittee, pointed out at the hearing that the funding legislation provides the oversight needed. It requires HUD to review and approve Puerto Rico’s action plans and monitor the funds as they are spent.

HUD’s Office of Inspector General (OIG) has also completed an audit of Puerto Rico’s housing agency. The OIG found that there was no corruption at the agency, and only flagged a few areas for improvement so that it will be able to properly handle a large amount of disaster aid. Although HUD officials say they are concerned about a Puerto Rican government where protests forced the governor to resign, the OIG has found the housing agency responsible for managing disaster aid to be capable and will be doing regular audits.

Members of Congress expressed outrage at HUD’s latest delay getting critical recovery funds to Puerto Rico. Representative Joaquin Castro (D-TX) chairs the Congressional Hispanic Caucus. Referring to top HUD officials, including HUD Secretary Ben Carson, Castro said at a press conference that, “they knew their actions were illegal and yet they did it anyways.”

None of the other states recovering from natural disasters since 2017 have experienced these delays. Representative Price accused HUD of “singling out Puerto Rico again.” An aide to Price noted that HUD had signed grant agreements with all of the states that applied to the September funding notice, except for Puerto Rico and the U.S. Virgin Islands.

Democratic lawmakers made clear that any further delays would not be tolerated. Speaking with NBC News, Representative Price said, “This is not meant to be a suggestion, it’s mandated. It’s time to release this notice and the longer this goes on, the more one has to wonder about the political influences that might be taking place at the top.”

HUD responded to Newsweek’s story about the delay by pointing out that Puerto Rico has so far only spent a small amount of the money available to it. Of the $1.5 billion that has been released, HUD says Puerto Rico has only spent $5.8 million. Before they can begin, though, large infrastructure projects must have most of their funding in place. HUD’s delays in letting Puerto Rico apply for its remaining funds have certainly made it harder to spend the little that has been released.

Hundreds of organizations have joined lawmakers in calling for HUD to release Puerto Rico’s disaster aid. Led by the National Low-Income Housing Coalition (NLIHC), the Disaster Housing Recovery Coalition’s 850-plus members have demanded that HUD immediately release disaster mitigation aid to Puerto Rico

Kathy Bergin, director of the Disaster Housing Law Project, said that, “HUD needs to stop playing games. Thousands of people in Puerto Rico are still living in dilapidated homes with tarp-covered roofs. What good does it do to formally allocate money for housing recovery, without a system that allows Puerto Rico housing officials to access those funds?”

It is shameless that HUD has endangered millions of American citizens with its delays. Low-income renters are usually the hardest hit by natural disasters. Thousands of people died in the aftermath of Hurricane Maria. Two years later, Puerto Rico remains more vulnerable than ever because major rebuilding has been put off for lack of funds. Members of Congress and the public are right to hold HUD accountable for these delays.

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Chris Holden

Chris Holden, Affordable Housing Online's Senior Housing Analyst, has been in the affordable housing field for 25 years. Originally from Keene, New Hampshire, he has worked as a researcher, policy analyst, lender, trainer and real estate developer. He also taught political science at Keene State College. He is focused on making housing policies more accessible for low-income renters.