FEMA seeking millions it was bilked in Katrina aid

NEW ORLEANS — In the neighborhood President Bush visited right after Hurricane Katrina, the U.S. government gave $84.5 million to more than 10,000 households. But census figures show fewer than 8,000 homes existed there at the time.

Now the government wants back a lot of its money.

The Federal Emergency Management Administration has determined nearly 70,000 Louisiana households improperly received $309.1 million in grants, and officials acknowledge those numbers are likely to grow.

In the chaotic period after two deadly hurricanes, Katrina and Rita, slammed the Gulf Coast in 2005 — Katrina making landfall in late August, followed by Rita in late September — federal officials scrambled to provide help in hard-hit areas such as submerged neighborhoods near the French Quarter.

But an Associated Press analysis of government data obtained under the federal Freedom of Information Act suggests the government might not have been careful enough with its checkbook as it gave out nearly $5.3 billion in aid to storm victims. The analysis found the government regularly gave money to more homes in some neighborhoods than the number of homes that actually existed.

The pattern was repeated in nearly 100 neighborhoods damaged by the hurricanes. At least 162,750 homes that didn't exist before the storms may have received a total of more than $1 billion in improper or illegal payments, the AP found.

The AP analysis discovered the government made more home grants than the number of homes in one of every five neighborhoods in the wake of Katrina. After Rita roared ashore, there were more home grants than homes in one of every 10 neighborhoods.

The AP's investigation drew immediate attention Tuesday on Capitol Hill.

"Any time the government is handing out checks, there are going to be people who deceive us," Rep. Charlie Melancon, D-La., told colleagues at a House committee hearing on the federal response to Katrina. "And I hope they get every dime of it back and prosecute those they catch."

"This was a whole 'nother fiasco."

Rep. Gene Taylor, a Mississippi Democrat whose district was also battered by hurricanes in 2005, thanked FEMA officials for helping but urged Congress to demand a "full public accounting" of all tax dollars spent on the recovery effort.