WASHINGTON – Possibility of an additional delay on interpretation of the Duplication of Benefits waiver may prompt Congress to impose sanctions or take legal action against the federal Department of Housing and Urban Development.
The plan of action comes after a listening session – a less formal version of an oversight hearing – in which HUD officials said it would take until March or April to resolve the waiver issue, Congressman Garret Graves told The News.
The meeting Dec. 6 included officials from HUD, FEMA, the Small Business Administration and the White House.
Disagreements among agencies prompted the meeting, said Graves, R-District 6.
“I wanted them all in the room at once because of all the finger-pointing between those folks,” he said. “The law has been changed and the Duplication of Benefits issue has been fixed in the law, but there are bureaucrats who have been fighting this from the very beginning and disagreeing that people who made SBA loans should be eligible.”
The House and Senate in early October agreed to a fix on the Duplication of Benefits provision, which Congress included in the Federal Aviation Reauthorization Bill that President Trump signed into law.
The legislation has not ended delays in the $250 million the Community Development Block Grant funds Restore Louisiana was set to dole out to residents who had previously been denied awards.
An interpretation of an SBA loan and Restore award as a duplication of benefits has blocked thousands of residents from receiving additional assistance after natural disasters of 2016, which included the floods in March and August 2016, as well as tornadoes in February 2016.
Graves and other Congressmen may consider sanctions against HUD, including the restriction of funding as part of the House Appropriations Bill.
“If HUD will not to pay disaster victims, then HUD shouldn’t be paid,” he said. “We’re also working on legal action because there are balances of power and mechanisms by which folks can get legal recourse or reconciliation.
“The law is fixed and there’s not a single problem with the law,” Graves said. “It’s deep-staked bureaucrats holding up the law.”
Graves and other congressional members have expressed their frustrations to HUD secretary Dr. Ben Carson, along with his now former assistant Neil Rackleff.
“These are the same people who appropriated the $1.2 billion in relief back in February, and they still haven’t issued the guidance,” he said
The latest holdup has not only drawn anger from the Louisiana delegation.
The 45-day waiver has also expired for Texas and North Carolina, whose representatives also sent waiver requests. Florida, Puerto Rico and the U.S. Virgin Islands will also make similar requests.
The issue may wind up in the courts, Graves said.
“This is not just a Louisiana deal,” he said. “This is all a bunch of bureaucrats driving this thing out, and these are the same agencies who allow the same benefit to go through in 2012 after Super Storm Sandy, yet they’re fighting it with us … it’s a bureaucratic nightmare.
“The actions by HUD are unacceptable and illegal,” Graves said.
An opinion from HUD that the states do not need President Donald Trump’s signature on a waiver further complicated the discussion.
Representatives from HUD and FEMA said the waiver does not need the President’s signature, as he does not hold the authority to determine if a loan and grant are duplicative because they are limited to SBA loans and CBDG grants.
“They say there’s nothing for the President to sign on because there’s nothing discretionary and that the law is automatically approved,” Graves said. “If that’s the case and they’re saying nothing has to be changed, I’d go back to the state and tell them to start cutting checks immediately.”
Graves believes the federal agencies should provide more assurance that they will not change their stance in the middle of a state’s distribution process.
“We asked what would happen if we go tell the states to start cutting checks, and the response was, “Oh, gosh! We don’t know”,” Graves said. “One of my options is to go back to the state and tell them to cut the checks because the law has been changed, the loan is no longer duplicative of a grant and there are no discretionary changes, so I don’t see any hurdles or barriers.”
Gov. John Bel Edwards has chosen to wait for either the President’s signature on the waiver or a more definitive answer from Washington. He has hesitated to dole out the money because of fears HUD will say the state did not have the authority to dole the money, and then seek payback of the funds.
Graves said he has not yet discussed the latest matter with state officials.
He and his fellow congressional members hope to resolve the matter before the Christmas break.
“It’s certainly our objective, so we’re getting Congress and all the other states involved to bring the hundreds of millions of dollars to the disaster victims who haven’t gotten their money,” Graves said. “In the meantime, we’re working on sanctioning HUD on the notion that if they don’t pay the disaster victims the money they deserve, then we won’t pay HUD.”