News Payback time

FEMA reimbursements can be tardy and incomplete

Mayor Phil Hardberger had calm in his eye two weeks ago as he announced that San Antonio would open its doors - and its checkbook - to Hurricane Katrina evacuees.

"We're not going to get caught up in bureaucracy," he said, in one of the defining moments of his three-month mayoral tenure. "We'll write checks and get reimbursed later."

The City has spent upwards of $1 million to care for the 13,000 displaced people who have streamed through San Antonio; about 5,000 evacuees remain.

Yet, given the Federal Emergency Management Agency's spotty history of disaster reimbursements to communities, San Antonio and Bexar County could be waiting a long time for their money.

Michael Simmons, Jupiter, Florida's financial director, is still waiting for $3.5 million in federal reimbursements from two hurricanes in 2004. While FEMA has disbursed $370,000 to the coastal town, Simmons estimates it will require from $7-9 million in federal disaster relief for debris cleanup and other costs. Last month, FEMA advanced Jupiter $3.1 million, although the agency could demand that the town pay back the amount.

"The town is lucky we got that," says Simmons, adding that FEMA's debt to Jupiter has "created liquidity problems." "I had $8 million in a disaster relief fund, but I can't spend it all."

Simmons tapped Florida Congressman Clay Shaw to intervene on behalf of Jupiter, a tourist town of 45,000 people. With Shaw's clout, $1.7 million is due to arrive any day.

Simmons attributes the delays to FEMA's cumbersome bureaucracy and frequent staff turnover. The agency has required Jupiter officials to submit the same paperwork a half-dozen times.

"FEMA keeps changing the rules about what's eligible `for reimbursement`, what forms you have to fill out, what proof you need," he says. "I've been very, very frustrated."

Simmons advises local officials to get FEMA reimbursement agreements "in writing and signed by a person of authority." He also recommends the City and County demand to work with the same FEMA officials throughout the process.

Even that might not be enough.

"I thought I was playing by the rules and none of it has had any effect," Simmons adds. "In emergency management you have to respond and be flexible. At FEMA, it's not there."

FEMA did not return calls to the Current seeking comment.

"Don't hold your breath. The pattern of the federal government is to shove expenses onto
local government."

- State Senator Leticia Van de Putte

It took more than a year for San Antonio to receive its federal reimbursements after the devastating 1998 flood that caused an estimated $50 million in damage. The City bought out homes in flood plains using stormwater funds, and the reimbursements were "new ground" for FEMA, according to Interim City Manager Rolando Bono.

"Our past experience is that it took too long," Bono says. "It depends on the nature of what's being reimbursed. In the past we had to rebuild bridges first and then get reimbursed."

Bono says San Antonio has a greater chance of receiving timely reimbursements because its expenses are more concrete: cots, portable showers, and other equipment for which City staff can present receipts. A FEMA incident-management team stationed in San Antonio is already buying some items. "I feel we're going to get a quicker response this time," Bono says. "There is a mountain of verification for the City. The answer lies in our ability to master their forms."

Bono acknowledges that the City may not receive full reimbursement for some items and services. While overtime costs for police are reimbursable, FEMA is reluctant to pay for routine law-enforcement expenses. "Our position is that anything we spent on disaster relief is reimburs-able," Bono says.

The City's disaster-relief expenditures will be carried into the next fiscal year, which begins October 1. Bono hopes the City will receive its federal reimbursements no later than October 2006.

This prediction seems hopeful, at best, considering FEMA's apparent financial ineptitude. Auditors could not sign off on FEMA's 2001 financial statement because of missing and incorrect information, according to a January 2003 Government Accountability Office report critical of the agency. Until FEMA addresses its "reliability of information and instances of non-compliance," the report reads, "FEMA will not be able to achieve effective financial accountability."

Such lapses have prompted State Senator Leticia Van de Putte, a Democrat, to question FEMA's ability to pay reimbursements in full and on time. "Don't hold your breath," says Van de Putte, who has worked nights volunteering in the evacuee shelter at the former Kelly Air Force Base. "Expenses for health and law enforcement may be shouldered by the County and the hospital district. The pattern of the federal government is to shove expenses onto local government."

Van de Putte, a three-term state senator and five-term state representative from San Antonio, said the legislature could borrow against next year's budget and grant an emergency appropriation to tide over cities and counties waiting on FEMA funds.

Governor Rick Perry apparently also has reservations about federal reimbursements. In a September 8 press release, Perry asked U.S. Health and Human Services Secretary Mike Leavitt for assurances that Texas would receive full reimbursement for providing Medicaid and other health-care services to the more than 200,000 displaced Gulf Coast residents who came to the state.

According to Perry's statement, the Centers for Medicaid and Medicare Services had planned to ask Texas to cover the usual state match for Medicaid services. Perry wants the federal government to pay the full costs. "Clearly, no state in America could absorb the tremendous financial costs associated with meeting this public-health challenge under current guidelines that require states to pay a portion of Medicaid coverage," Perry wrote in his letter to Leavitt. "Without the guarantee of total federal funding ... Texas taxpayers will be forced to bear a financial burden that, in effect, punishes them for opening their hearts and homes to fellow Americans in need."

By Lisa Sorg

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