flood insure

There’s a bit of frustration regarding the most recent Duplication of Benefits (DOB) event.

Yes, it’s become a string of events, coronated by the original letter that declined someone for Restore Louisiana benefits because he or she either applied for, or accepted, a Small Business Administration loan – which now leads Livingston Parish to this.

What is this, exactly? It’s the payout for those who applied for or received SBA loans. Their Restore money will either go toward repairs or pay off portions of a loan – depending on how much the victim borrowed and the determination of the value of their specific damage.

The frustration stems from a portion of the guidance on DOB that the initial round of funding will target those within 120 percent of annual median income (AMI). Median income in the Baton Rouge area is roughly $39,000, meaning those who make more than $46,000 have some hoops to jump through in an appeals process.

With a chance to receive no funds at all.

Why? Well, the disbursements are part of a Community Development Block Grant (CDBG), via the U.S. Department of Housing and Urban Development (HUD.) That’s a lot of acronyms, but the important part to take away is that a CDBG almost always comes with a low-income ruleset – meaning that this outcome was inevitable.

Grant money for low-income areas is becoming more and more available. Developers in Baton Rouge are combining grant funds with tax shelter Opportunity Zones to create a vast array of low-income housing between downtown Baton Rouge and LSU.

It’s nice low-income housing, but it’s still low-income housing.

This, unfortunately, flies in the face of “community development.”

What Livingston Parish itself needs, at the moment, for “community development” is economic stimulus with an injection of funds back into the checking and savings accounts of its residents.

There were just 7,700 flood insurance claims made in the wake of the Great Flood of 2016. There are 16,500 flood insurance policies, in force, for Livingston Parish – which does not include Denham Springs or Walker. According to Gravity Drainage District 1, its service area from Port Vincent to near Watson contains almost 26,000 structures.

So not only did most people with flood insurance policies not tap them for recovery, there were clearly thousands of homes which were uninsured. Did all 26,000 structures flood? Probably not, but did plenty of homes without flood insurance take water? Absolutely.

And that water knew no income level.

This is a snapshot of the Denham Springs area, which – all told – encompassed almost $500 million of the $710 million in total claims. Including areas such as Walker, Watson, Albany, and Springfield make those values even worse.

These recovery dollars came from other places, if not from flood insurance or grant money, including loans, credit cards, savings, retirement, and emergency fund cash. What do people do after they’ve finished putting their lives back together to post-flood “normalcy?”

They hunker down. They start paying off the loan and the credit card; they cut spending to replace those savings and that retirement; they focus on rebuilding that emergency fund by giving up other purchases for a while.

Sales tax entities saw a boost in the first two years after the flood after victims spent what they could to replace furniture, appliances, home repair supplies, and vehicles. The vehicle funds have already ground to a halt in year three. What’s next?

The parish should be thankful it can collect from Amazon, because if the Restore money doesn’t focus on every homeowner who didn’t have flood insurance, the parish’s recovery will extend even further.

J. McHugh David is editor and publisher of the Livingston Parish News.

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