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Disaster assistance tangled up with politics - at a cost to taxpayers

By MEGAN O'MATZ, SALLY KESTIN, JOHN MAINES AND JON BURSTEIN

South Florida Sun-Sentinel

September 18, 2005

FORT LAUDERDALE, Fla. - (KRT) - Assistance designed to help those struck by disaster has also become a tool for politicians to bring home prized federal dollars and a windfall to residents in some of the nation's poorest communities.

In between are privately contracted damage inspectors with little incentive to safeguard the public purse.

The system is fueled by an unlimited budget - if the money runs out, the Federal Emergency Management Agency returns to Congress for more.
Everyone benefits, a South Florida Sun-Sentinel investigation found, except taxpayers footing the bill.

In the name of helping disaster victims, FEMA over five years awarded at least $330 million in areas with little or no damage, the newspaper found. While aid has legitimately flowed to thousands of people who lost their homes or belongings to fires, floods and hurricanes, thousands more have abused the system.

"It's an absolute abomination," said U.S. Rep. Mark Foley, R-Fla. "Whether intentional corruption or mismanagement ... it seems like FEMA is just a money pit."

Outrage over $31 million to residents of Miami-Dade, Fla., last year for a hurricane that missed the county called national attention to fraud and waste in FEMA assistance. But the problem has evolved over years in cities across the country, the newspaper found.

It all starts with the federal disaster declaration, the first step to start the money flowing - a process heavily influenced by politics.

Once disaster strikes, however small, politicians from mayors to governors to members of Congress pressure FEMA for a declaration and then boast about bringing money home.

By law, federal aid is meant for major disasters that overwhelm state and local governments. Officials are supposed to prove a need for help through "damage assessments," the backbone of formal requests from governors to the president.

But the Sun-Sentinel found those assessments are not always done. Even when they are, they're sometimes not an accurate reflection of reality.
In New Hanover County, N.C., several residents whose names appear on assessments used to support disaster declarations for Hurricane Isabel in 2003 told the newspaper they suffered no damage to their homes.

In Ohio's Summit County, Emergency Management Coordinator Annette Petranic said her office has been pressured by the governor's staff and members of Congress to "try again" when initial counts failed to turn up enough damage for a declaration.

"We get asked to take a second look at things ... for political reasons," Petranic said. "Elected officials really want to get the disaster declared."
Politicians then tout their role in getting the money.

"This summer, Gov. (Jim) Doyle was successful in obtaining federal disaster aid for storm victims and local communities in 44 Wisconsin counties," a December 2004 state news release said. "This was the greatest number of declared counties in one summer since 1993."

Russell Sobel, a West Virginia University professor, has researched how closely disasters and politics are intertwined.

"This is really the game of politics," he said.

Sobel co-authored a 2003 study that found states politically important to a president have higher rates of disaster declaration.

Last year in Florida, President Bush declared Miami-Dade and other counties a disaster for Hurricane Frances before the storm had passed through the state. That decision eventually led to almost 13,000 Miami-Dade residents collecting money even though they never experienced a hurricane.

Four years earlier, President Clinton granted a declaration for an Oct. 3, 2000, storm that delivered heavy rains in South Florida.

"FEMA is expected tomorrow in the a.m. to begin their damage assessment," an Oct. 4, 2000, Miami-Dade County report states. By that evening, a declaration had been issued.

Declarations often include areas much broader than the disaster - "contiguous counties" included only because they are next to a stricken area - and entire counties for damage confined to a few blocks, the newspaper found.

After a tornado in Miami-Dade County in March 2003, some nonprofit agencies and the county's public housing agency concentrated their assistance in the 1.5-square-mile area affected. But FEMA declared the whole county a disaster and awarded most of the aid, $9 million, to people outside the damage area.

Once a declaration is made, anyone in that area can apply, and FEMA does little to verify the legitimacy of the claims, the newspaper found. In disasters reviewed by the Sun-Sentinel, FEMA officials never consulted meteorologists or local officials most familiar with damage in their communities before approving claims.

"I would have told them there was no damage," said Ed Broomfield of the Los Angeles County Office of Emergency Management.

The county was included in a declaration for wildfires that raged through Southern California in 2003. The fires never burned in the city of Los Angeles or nearby areas, yet FEMA awarded $5.2 million to more than 5,000 applicants there.

FEMA's own publicity efforts can help bolster claims. Within hours of a declaration, the agency begins publicizing assistance through the media and "community relations teams" that visit churches, businesses and community groups, posting fliers and encouraging applications. The teams carry cell phones so that people can apply on the spot.

"They're out there almost begging people to apply," said Arthur Jones, disaster recovery chief in Louisiana, where the teams were temporarily kicked out after storms in 1995. "They were drumming up business."

In July, after Hurricane Dennis hit the Florida Panhandle, then-FEMA Director Michael Brown appeared on CNN's "Larry King Live" show and promoted federal aid.

"I would encourage anyone, whether you think you're qualified or eligible or not, don't make that decision yourself. Call the 800 number, and our operators will work through the process with you to see if you are eligible," Brown said, reciting the phone number 1-800-621-FEMA.

"That's FEMA, F-E-M-A," King added.

The message gets out loud and clear.

Because FEMA assistance is restricted to those with losses not covered by insurance or with no insurance at all, most of the money winds up in the poorest communities.

From Miami to Baton Rouge to Cleveland, word spreads when FEMA is in town. Inner-city residents call the assistance "free money" and have learned from disaster to disaster how to file claims even if they suffered no damage, the Sun-Sentinel found.

Katherine Williams and other tenants of Nickerson Gardens, a public housing development in the Watts section of Los Angeles, said they thought they deserved money for the 2003 wildfires just as much as people in "big houses" in the hills where the blazes burned. Though miles from the fires, they said smoke got into their clothes and furniture, and ash damaged the paint on cars.

"We're a struggling people," said Williams, a 54-year-old nursing assistant. "Whenever we lose something, it's hard to get it back."

Williams said FEMA turned down her claim, but she knew of neighbors collecting money.

The job of deciding whether claims are valid falls to FEMA inspectors assigned to visit applicants' homes. FEMA refers to the inspectors, who work for private companies under contract with the government, as their "first line of accountability" against fraud.

They get paid for each inspection completed, regardless of whether the claim is approved, and have little incentive to safeguard tax dollars.
After last year's hurricanes in Florida, FEMA relied on hundreds of novice inspectors, each with only a few hours of training. Their error rate was more than three times higher than those for experienced inspectors, a U.S. Senate investigation revealed in May.

The newspaper found that for years inspectors have signed off on dubious claims in areas on the fringes of disasters.

Current and former inspectors told the Sun-Sentinel that they are often sent to poorly kept homes and apartments that leak in any hard rain. FEMA isn't supposed to pay for damage that is a result of "deferred maintenance," but the agency has instructed inspectors to take applicants' word when they insist losses were caused by a disaster.

After Hurricane Isabel in 2003, Eddie King, emergency manager in Pender County, N.C., recalled "a lengthy discussion" with a FEMA inspector who argued zealously that a fire that destroyed a woman's mobile home was hurricane-related.

King, who was also the county fire marshal at the time, attributed the blaze to faulty electrical wiring in the kitchen. "I'm, like, `Sir, it occurred 24 or 36 hours before any hurricane-force winds ever reached Pender County!'" King said.

"I do not know where that case ended up, but that to me is an example of misuse of the system," he said. "I hate like everything that this lady's house caught on fire ... but it was not related to a hurricane."

Intimidation can also make the money flow. Inspectors told the newspaper that some applicants have threatened them. FEMA acknowledges inspectors have been too generous in assessing damage, a phenomenon the agency calls the "tough neighborhood syndrome."

After the 2003 tornado in Miami-Dade County, "irate applicants" called inspectors "demanding to know why the inspectors didn't give credit for all the damage," according to a quality control review by the inspection company. The applicants "used abusive language" and "charged that the inspectors discriminated against them."

Once the inspection is complete, the results are sent by computer to FEMA. If eligible losses are recorded, the applicant gets a check.
Few of the claims are scrutinized. FEMA requires a "quality control review" of only 3 percent of inspections but has left it largely up to the contracted companies to check their inspectors' work. During the past three years, those reviews revealed errors as high as 90 percent, records obtained by the newspaper show.

A complex system made up of many moving parts, the disaster assistance program rarely stops once it kicks in, the newspaper found. Officials in several states have gone so far as to write FEMA with concerns of widespread fraud but have been unable to stop the money.

In Miami-Dade, FEMA's own community relations teams left the county after only two days last fall because they could find no damage from Hurricane Frances, records show. Yet the money continued pouring into the county for months, even after complaints from the public and Congress.

All the while, FEMA officials denied any major problems. A Senate committee investigating the Miami-Dade Frances payments "exposed fraudulent claims, wasteful spending and ineffective government management in FEMA's response to the 2004 Florida hurricanes."

Then-Director Brown responded by thanking senators for their input on FEMA's "successful response and recovery efforts" to the hurricanes.
Last Monday , Brown resigned amid criticism over his agency's slow response to Hurricane Katrina.

Sharlot Edwards, emergency preparedness director in Louisiana's West Baton Rouge Parish, just wanted FEMA to explain where the alleged damage was after Hurricane Lili in 2002. Parish residents collected $1 million from FEMA.

"I was totally shocked when I saw the figure," Edwards said. "I really was, for the simple fact that we weren't aware that there was much damage in our parish."

FEMA informed Edwards it could not share any information because of privacy laws.

"I tried to get them to tell me at least the areas that the damage was in so we'd know where to start looking and doing preventive measures," she said. "They informed me they couldn't do that."

Why?

"I don't know," Edwards said. "They said they couldn't tell me."