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Puerto Rico left out of billions of dollars in disaster mitigation relief

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HUD says “local ‘governance and financial management challenges’” means funds won’t be released yet

A man stands on the doorstep holding a loose piece of sheet metal on a street damaged by a tropical hurricane.
Residents of San Juan, Puerto Rico, deal with damages to their homes on September 20, 2017, after Hurricane Maria battered the island.
AFP/Getty Images

As part of the federal government’s new disaster mitigation program, $6.75 billion was awarded to states across the country on August 23, including Texas, Louisiana, Florida, North Carolina, South Carolina, West Virginia, California, Missouri, and Georgia, to help them prepare for future hurricanes and natural disasters.

But, in a disappointment to advocates for Puerto Rico and the United States Virgin Islands, both regions have been left out of this recent round of funding, despite never fully recovering from recent storms, and despite Congress having long since appropriated funds for both territories. Puerto Rico was initially supposed to receive more than $8 billion, money that would have, in part, helped rebuild and strengthen the island’s power grid. Sources tell Curbed HUD has no timeline to determine when both territories will be ready to receive the funds or when they might be sent.

The Department of Housing and Urban Development, which oversees the program, said in a statement that the money was withheld because the territories are unable to properly manage or use it. A statement that accompanied the funding release notes that HUD “acknowledges the governance and financial management challenges of the Commonwealth of Puerto Rico and the on-going capacity considerations in the U.S. Virgin Islands,” specifically referencing the corruption issues that have led to Puerto Rico’s leadership crisis and rotating cast of governors.

There’s no excuse for the delay, says Diane Yentel, president and CEO of the National Low-Income Housing Coalition (NLIHC), the lead organization for the Disaster Housing Recovery Coalition. Congress appropriated $16 billion in funding for the program 18 months ago, and a supplemental funding bill passed in the spring required HUD to release the funds by September 5th. The NLIHC has sent a letter to HUD demanding funds be released immediately, noting that 300,000 homes need repairs from damage sustained through Hurricane Maria. Of those 300,000, 33,000 still don’t have roofs, and the island needs funding to rebuild the infrastructure necessary to withstand another storm.

“President Trump’s and HUD Secretary Ben Carson’s withholding of these badly-needed mitigation grants mean that Puerto Ricans cannot begin planning for how they will rebuild to make their communities more resilient to future natural disasters,” says Yentel. “With another hurricane bearing down on Puerto Rico, every day of Secretary Carson’s inaction puts American lives at risk.”

Announced in the federal register last week, the funding is part of the new Community Development Block Grant Mitigation (CDBG-MIT) program, which is overseen by HUD and is designed to address the predictable impacts from events that haven’t yet occurred. HUD has traditionally played a huge role in helping communities bounce back from natural disasters through what’s called Community Development Block Grant Disaster Recovery funds. Nearly $90 billion has been disbursed by the program since 1992, and those funds have been instrumental in helping states such as New Jersey and Texas recover from major recent storms.

The new mitigation funding is an effort to be proactive and use federal money to strengthen homes and infrastructure so it’s more ready to withstand the next storm. Every dollar spent on mitigation saves $4 to $6 in disaster recovery spending.

The funding program program is part of a larger look at how the federal government can better spend billions of dollars annually in disaster recovery funds in an era of climate change and increasingly damaging storms. The money can be spent to elevate homes or buy out owners of property in flood-prone areas to reduce damage from future storms and better prepare the coastline for hurricanes and flooding.

HUD announced in early August that funding for CDBG-MIT might be divided into two phases, due to worries about how the money would be used and spent in Virgin Islands and Puerto Rico.

“Recovery efforts in jurisdictions prepared to do their part should not be held back due to alleged corruption, fiscal irregularities and financial mismanagement occurring in Puerto Rico and capacity issues in the U.S. Virgin Islands, which is why HUD will award disaster mitigation funds in two separate tranches,” said Secretary Carson. “Untangling these funds from each other will help recovery and planning move forward in communities capable of properly and prudently disbursing funds, all the while protecting taxpayers who are footing the bill.”

Currently, Puerto Rico is subject to a tropical storm warning and potential hurricane watch as Tropical Storm Dorian moves through the Caribbean in the direction of the island. Forecasters predict it may strengthen to hurricane force by the time it passes over Puerto Rico Wednesday.