News Roundup

Help for Louisiana: Why a waiver on federal funding rules is needed

The Washington Post
Editorial
Saturday, April 7, 2007; A12

LOUISIANA IS in a bind. Nineteen months after hurricanes Katrina and Rita decimated its economy, slashed its tax base and hobbled its workforce, the state is struggling to get back on its feet. Every dollar of redevelopment money is vital. That’s why there have been consistent calls on President Bush to waive the 10 percent local match requirement on projects using money from the Federal Emergency Management Agency. And just as consistently, he has refused. Why is this 10 percent match, which local governments have to pay upfront, so important? Let us explain.

When disaster strikes, FEMA stands ready with financial aid. The agency is absolutely right to demand that states share in the expense of cleanup and recovery. Under circumstances deemed “extraordinary” and with damage assessments above $110 per capita, FEMA can shrink that burden from the customary 25 percent to 10 percent. But the president has the authority to waive even that requirement in the event of major catastrophes. Mr. Bush did this for New York after the horrific Sept. 11, 2001, terrorist attacks (damage: $390 per capita).

Not so for Louisiana. Not after it was hit by the worst natural disaster in U.S. history; not after it sustained the worst damages in U.S. history ($6,700 per capita). Not after 1.3 million people were displaced from their homes. Not after its economy collapsed. And not after residents of a great American city, New Orleans, experienced what Mr. Bush called “the kind of desperation no citizen of this great and generous nation should ever have to know.”

While the administration refuses to waive the 10 percent match on FEMA-financed projects, it is allowing Louisiana to use $775 million in community development block grants from the Department of Housing and Urban Development to pay the fee. Good luck getting it. Not only must all of the 20,000 projects — big and small — adhere to FEMA’s rules, but they also must comply with HUD’s requirements to get the money. Therefore, projects can’t proceed unless it is determined in advance that they will meet the crazy quilt of separate yet duplicative requirements of two federal agencies. It’s estimated that the process could generate at least 2.6 million documents (not pages). Louisiana stands a better shot at winning money on “Deal or No Deal.” And those HUD funds could be better used to build schools, housing and other infrastructure. More important, freeing up this money would give New Orleans a big chunk of the money it needs to finance its smart redevelopment plan.

Speaking from Jackson Square in New Orleans on Sept. 15, 2005, Mr. Bush said, “When communities are rebuilt, they must be even better and stronger than before the storm … . We’ll not just rebuild, we’ll build higher and better.” Such progress is being tripped up by thick rolls of red tape. Mr. Bush can clear those obstacles and help turn his far-reaching vision into reality with a stroke of a pen by waiving the 10 percent FEMA match requirement. He should do it now.