Hurricane Katrina destroyed more than 200,000 homes in Louisiana alone, including more than 82,000 rental homes. All told, the storm displaced more than a million people from the Gulf Coast, with 600,000 households displaced a month after the hurricane.
When President Obama took office three-and-a-half years later, nearly 40,000 families who had been displaced by the storms were still relying on government assistance to find housing. And within days of his inauguration, I discovered that more than 30,000 of those families were on the verge of losing that assistance—and potentially their homes—when the Disaster Housing Assistance Program came to an end.
Working with nearly 350 public housing agencies around the country, we helped all of these families find permanent housing by extending DHAP for an additional six months, providing comprehensive case management and providing 12,300 of the most vulnerable families with permanent Housing Choice Vouchers.
We also worked closely with our partners across the administration. For the 7,600 families that remained in temporary housing units throughout the Gulf Coast when we took office, FEMA and HUD worked together to move as many of these families as possible into permanent housing.
All told, because of these efforts, I’m proud to say to you today that, of the 40,000 families who relied on temporary government housing assistance when we took office, we have helped 98 percent of them move into permanent housing. But we will not rest until we’ve completed the job for the 883 remaining families.
One of the reasons we’ve made progress is that we realized early on that far too many Gulf Coast residents—through no fault of their own—had become stuck in the recovery process due to numerous challenges and barriers that left them unable to complete the rebuilding of their homes—or their lives.
That is why, since taking office, HUD has provided the additional clarity and guidance to states that gives them flexibility to address these so-called unmet needs—including modifying a rigid “duplication of benefits” rule which failed to account for the true cost of displacement.
With hundreds of thousands of homes damaged and destroyed, Louisiana’s Road Home Program is among the largest housing efforts ever undertaken by a state in our nation’s history, assisting homeowners across more than two dozen parishes throughout all of Southern Louisiana and nearly 46,000 in Orleans Parish alone.
A year ago, more than 4,000 eligible applicants had yet to receive their program award—by working with the state, we’ve reduced that number to 170. And we’ve resolved more than 1,700 appeals over the last year, with only 103 remaining.
Last year, we removed the $50,000 cap on grants to help low and moderate income homeowners rebuild their homes. This change has put nearly $400 million in rebuilding dollars in the hands of homeowners with modest incomes.
As part of this commitment HUD’s Office of Fair Housing and Equal Opportunity is investigating several complaints concerning practices that may be impeding the availability of federally assisted housing to families most in need—as well as new rental permit practices that allegedly restrict rental housing for African Americans attempting to return to their homes after Hurricane Katrina.
No one should have to wonder if the color of their skin somehow influenced whether they could receive a mortgage, access to economic opportunity, or disaster recovery assistance.
But this isn’t just about helping families who were living in temporary housing or at risk of homelessness. It’s also about rebuilding the region’s housing stock for families who want to return. It’s about helping a community that at one point had lost half its population and is now back over 90% not only rebuild what was there before the storm, but rebuild stronger and smarter.
One of the most important challenges we face today is vacant buildings and blight across the metropolitan area where we estimate there are 79,000 blighted units today. We have made progress since we came into office—this number has been reduced by 14%.
But to truly address the problem of blight, we must go beyond recovery to revitalization that solves the problems that existed before the storm, when the metropolitan area had one of the highest per capita vacancy rates in the country, with almost 30,000 vacant properties.
And in that respect, the Neighborhood Stabilization Program can be a powerful tool, helping communities purchase and redevelop vacant and abandoned homes.
I am also pleased to say that we are making real progress building affordable rental housing, which prior to Katrina, comprised half of all the housing stock here in New Orleans. And in the wake of the storm, public housing developments known as the “Big Four” were severely damaged, disrupting the lives of some of the city’s most vulnerable populations.
When we first came into office, HANO was in disarray. Today, it has leased up thousands more vouchers than were in use before the storm. Combined with our other efforts to spur privately owned affordable housing developments, we have created 8,400 affordable homes in New Orleans since taking office. In total, this means there is more federally assisted housing in New Orleans than there was before the storm.
But even still, we are committed to doing more. When we first came into office, not a single family had returned to the Big Four. Today, all four complexes are under construction and hundreds of families have returned to their homes there.
Programs that were simply stuck under the previous administration, such as the state of Louisiana’s $684 million Small Rental Property program, are now producing thousands of units with expenditures of $7.3 million per month—more than five times before I became secretary.
But as you also know, this work depends on a mixture of federal, state and private sector funds, which will require an extension of the “Placed-in-Service” date on Gulf Opportunity Zone Low Income Housing Tax Credits. Without an extension of the GO Zone credits, more than 6,000 Gulf Coast affordable housing units are unlikely to be completed.
This is a top priority for this administration, which is why I am so thankful for the leadership provided by members of the Louisiana delegation to ensure that the extension would be passed by the House and considered by the Senate.
The estimated 13,000 construction-related jobs that depend on the extension of these tax credits reminds us that public housing is not only a place for families to find safe, affordable housing—it also can provide a critical opportunity to create jobs, particularly for those who live there and need those jobs the most. And nowhere is that more true than New Orleans.
For that reason, I was thrilled to announce a new partnership in April between HANO and 5 local major service providers.
One notable example of this new collaboration is the recent effort initiated by HUD and orchestrated locally by Urban Strategies to secure $1 million of CDBG Funds to support a subsidized employment program. If funded, this program will provide approximately 200 adults with direct, on-the-job training.
CDBG disaster recovery funds have also helped New Orleans forge new partnerships that create jobs for those who need them the most. One example is Louisiana’s partnership with a consortium of local nonprofits, created to offer vital assistance in the Small Rental Property Program, which has produced over 3,000 affordable homes in the state.
The city of New Orleans has committed to participating in this partnership as well by creating a bonding pool to ensure small and minority businesses participation in redevelopment construction projects.
Of course, comprehensive community development means more than just housing or economic development—it also means quality healthcare for community residents.
Lastly, let me say a few words about the lessons we have learned. Perhaps the most important is that when it comes to disaster recovery, it is not just how much money government spends, but how we can spend it better and more effectively.
Too often in the past, the federal government has paid to rebuild what was there before the storm, rather than to build back stronger and smarter, helping avoid disaster when the next storm strikes.
According to an independent study by the National Institute of Building Sciences, every dollar spent on disaster mitigation saves taxpayers $4 in disaster recovery expenses.
That’s why HUD created a Disaster Relief Enhancement Fund, a $300 million pool to incentivize states recovering from disasters to use their funds in a way that would also mitigate against future disasters and prepare them for future recoveries.
And Louisiana and Texas are leaders in this respect. Louisiana and Texas received $1 and $3 billion, respectively, in CDBG funds to recover from Hurricanes Ike and Gustav—and have committed to using a substantial portion of those funds for disaster mitigation.
Shaun Donovan is secretary of the Department of Housing and Urban Development.
