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Project on Government Oversight

POGO letter to HUD IG regarding concerns about HUD's The Road Home program

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September 30, 2009

Kenneth M. Donohue, Sr.
Inspector General
Department of Housing and Urban Development
451 7th Street S.W., Room 8256
Washington, DC 20410

VIA FACSIMILE

Dear Mr. Donohue:

The Project On Government Oversight (POGO) is an independent nonprofit that investigates and exposes corruption and other misconduct in order to achieve a more effective, accountable, open, and ethical federal government. We understand from the Citizens' Road Home Action Team (CHAT) that your office is conducting an audit of The Road Home program, which is funded by HUD's Community Development Block Grant (CDBG) Program and is designed to provide up to $150,000 in compensation to Louisiana homeowners for the damage to their homes by Hurricanes Katrina or Rita.

We ask that you inform HUD and Congress that your audit is not yet complete, and that it would be premature for Congress to approve a request from the Louisiana Recovery Authority (LRA) to divert the half- to one-billion dollars of uncommitted Road Home funds away from the program, until that audit is complete and there are assurances that Road Home applicants have had their claims handled fairly.

We are encouraged that your office is auditing this important program. There is ample evidence that thousands of Hurricane Katrina or Rita survivors received less compensation than they were entitled to under the program. A January 2009 audit by the Louisiana Legislative Auditor, one of at least 11 conducted, found that the Road Home contractor ICF Emergency Management Services, LLC had numerous weaknesses in the integrity of the data in its database that tracked disputes. At least 22,000 applicants have had to dispute their grant amount through a resolution process riddled with errors, inconsistencies, conflicts of interest, and a lack of transparency. The subsequent appeals process suffers from the same problems.

CHAT has compiled hundreds of egregious instances in which applicants were given the runaround by the former contractor ICF and by the new contractor Hammerman and Gainer, Inc. (HGI). For example, after several years of struggle, John Lange, Patty Abshier, and 96-year-old Doris Taggart have received far less compensation than they should have, and Denise Fletcher and Renee Cheavis have received no compensation at all, because of patently faulty assessments of the damage to their homes. John Lange summarized his appeals process in a May 20, 2009, email to Senator Mary Landrieu (D-LA) and other Members of Congress: 

This process is coming up on three years now. It has been filled with countless phone calls and letters never answered. When you did get someone on the phone, they were almost always totally incompetent and never helpful. Employees of the Road Home were not allowed to respond in writing to any requests and often denied having made statements in previous conversations. Total deniability. 

POGO is concerned your staff has not contacted such individuals as part of the IG's audit. We ask that your office reach out to them to access the specific documents on how the contractors—ICF Emergency Management Services and HGI—may have shortchanged them of their grants in ways that may not be apparent by examining only the contractors' records. There are many Road Home applicants who can provide your investigators with detailed accounts and documents about the extensive problems they encountered when trying to access the funds HUD allocated to help them rebuild their homes and lives in the wake of Hurricanes Katrina and Rita.

I look forward to your response and to the results of your audit. Please let us know if you have questions by calling (202) 347-1122.

Sincerely,

Danielle Brian
Executive Director