On 2/20/06 the LRA submitted its plan for using $7-7.5 billion in CDBG money to support homeowners damaged by the storm. The diagram provides an outline of the plan and the www.road2LA.org website provides details.

Congress approved an additional $4.2 billion for the program and including FEMA Increased Cost of Compliance (ICC) funds the LRA expects the Road Home program to distribute over $12 billion. ICF has been contracted for $757 million to administer the program. HUD approved the program and pilot activity started in July.

In October 2006 the program finally got underway. ICF completed a pilot program and extensive audits by HUD assured that the program was being conducted properly. 33,800 applications had been received and $10.6 million had been "verified and calculated" in 255 grants in the pilot program.  No money was distributed. Critics claim the program was going too slow, was too complicated and was being poorly delivered. A similar program is Mississippi is slightly ahead of the Louisiana plan in terms of grants made.

By November 2006 fewer than 20 checks had been issued for a total of $600,000. Nearly 80,000 applications were on file with most awaiting their initial interview. LRA and contractor ICF were under pressure from the Governor and the public to speed things up. Mississippi had issued only a couple hundred checks so far to its 17,000 applicants.

In December 2006 the State Legislature passed a resolution demanding ICF be fired for poor performance. Private meetings ensued and the Governor came out in support of ICF's continued services. One compromise in the works would allow residents to be paid awards already approved while appeals are being considered. On Dec. 15 ICF's Michael Byrne cooled the criticism when he said that he hoped to see 500 grant closings a day by some time in January. On January 10th, with the hoopla one month behind him, he clarified by email:

"The Road Home program never established a specific goal for closings in January or any other month, We do estimate targets for capacity. We are building a pipeline that can handle a certain volume, but we can't control whether the capacity is achieved, as many of the factors determining our volume are established outside of our program."

I guess we can all hope this program gets straightened out. Hoping don't make it so.

In February 2007 Mississippi is reporting the two thirds of its $5 billion had been distributed. Louisiana has closed on fewer than 500 claims worth less than $50 million. To date more money has been paid to administer the program than has been awarded.

In March another controversy, this time between the feds and the state emerged. The Road Home plan pays homeowners in installments as work is completed. Federal requirments for a "compensation program," as Road Home is classified, call for a lump sum payment. The state is concerned that  paying in lump sum will permit homeowners to take the money without repairing their property. HUD and the state are meeting to address this problem. Further delays are feared if the Road Home rules have to be revised at this late date.

In April, 2007 things began to move a bit faster as the state revised its title search requirement for homes being repaired and ICF starting moving faster. Most closings continued to occur in the last few days before the end of the month rather than throughout out the month suggesting a rush to meet a deadline. Another controversy erupted when ICF seven figure executive bonuses were reported in quarterly financial reports.

In May 2007 all hell broke loose when it became clear that the average $75,500 grant times the 130,000 applicants was going to break the $7.5 billion dollar budget. A $2.5-3.5 billion overrun would be 33-40% of the entire program. The feds say no more money. They claim the state ignored advice to limit the program to flood damages. The state claims the federal estimates of damage were low, insurance payment estimates were high and rebuilding costs are out of sight. Everyone is scrambling. People are looking at the state's budget surplus, the 10% local matching funds (if Congress forgives them), and $0.5 billion in Hazard Mitigation Grants that have been quietly redirected to the Road Home. Reprogramming funds is bound to hurt the recovery in other areas like infrastructure repairs. (Is this fiasco the real reason Blanco decided not to run for reelection? Maybe ending cock fighting will make it all right because that's all the Legislature seems interested in.)

At the end of May we are beginning to hear that the closings to date have not provided the entire calculated benefit. Apparently the ICC funds allocated to raise a home to the required level is not included yet and will not be paid until the first round of closings is complete.

As of	Applications	Appointments	$Calc	Letters	Accepted	#Paid	$Paid (est)	$Cost (est)
11/30/6	70,000			10,000		24
12/31/6	90,783	61,295	$1.7 billion	23,539	6,571	97	$5.1 million	$5.53 billion
1/8/7	95,994	63,813	$2.1 billion	23,539	7,650	118	$9.3 million	$8.32 billion
1/15/7	98,812	66,014	$2.23 billion	29,147	8,341	177	$13.9 million	$8.52 billion
1/29/7	103,710	70,853	$2.49 billion	31,914	14,040	391*	$31 million	$8.98 billion
2/19/7	117,390	89,101	$4.2 billion	55,730	25,252	3,085	$236 million	$9.74 billion
4/3/7	121,466	93,374	$4.7 billion	61,848	26,733	6,100	$464 million	$10.00 billion
4/30/7	130,828	105,271	$5.3 billion	70,053	36,666	13,753	$1.043 billion	$10.68 billion
5/28/7	140,243	117,697	$6.25 billion	83,182	42,342	22,174	$1.667 billion	$11.3 billion
6/25/7	149,193	130,500	$6.55 billion	89,227	55,666	30,305	$1.96 billion	$11.0 billion
8/6/7	180,424	152,810	$7.8 billion	113,690	77,081	40,130	$2.8 billion	$12.4 billion
9/17/7	184,601	176,503	$ 8.4 billion	124,410	93,169	52,525	$3.3 billion	$12.5 billion
2/11/8	185,106	166,097	$ 9.5 billion	156,657	93,169	98,359	$5.8 billion	$10.0 billion

• Step1 - Application reviewed, information verified, award calculated, award letter mailed
• Step2- Homeowner chooses option, returns letter
• Step3- Closing held

* The Road Home changed reporting to include closings scheduled as well as those held (is this just an attempt to make the numbers look better?)

Cost (est) based on proportion  #applicants * ($calc/letters). May be overstated if late applications are for fewer dollars than earlier applications. That would make sense, why would you wait so long if you had a lot of money at stake. Those 30,000 applications in the final month suggest this may be true.

Applications closed on 7/31/7 so 180,424 ought to be the final number of applications.

By February, 2008 it is becoming clear that the later applications produced a large number of dropouts or ineligible applicants. Nearly 20,000 dropped out before even attending an initial appointment. About 60% of the claims have now been through closings.

As of December 2006 Road Home has received 88,000 applications, conducted 45,000 initial interviews, issued 10,778 award letters (worth $850 million) and paid 80 awards worth about $5.6 million. ICF has been paid $60 million to administer under $6 million in awards to date.

If the pace of this program seems a bit slow, consider the state's bizarre decision to delay even starting the program until Congress had awarded the second CDBG grant. Money has been available since February, 2006 and virtually none of it has been put to any use in 2006.

Rumors are spreading that ICF

1. was on the selection committee that chose ICF as the vendor
   
2. has a $19 million line item in the contract for employee travel back to Virginia. ( At $250 for round trip airfare, $19 million would provide 76,000 round trips. I don't think they were encourage to hire locally.) 
   
3. that 1/3rd of the 10,778 awards calculated have been refused (or perhaps appealed),
4. that award letters have been sent congratulating residents on their awards of $0.00
   
5. that appraisal of preK values is the real problem with the program
   
6. and that the insurance companies, FEMA and others are the culprits for their slowness in confirming information (what are they being paid for their efforts?)