Sunday, May 08, 2011

Cleaning up after the con

Road Home wants its money back. Of course tracking down where it went in the first place is a complicated enough task.

For more than 90,000 of the 117,785 Road Home grant recipients who elected to rebuild their homes, the three-year deadline to finish their work has passed. The state is in the midst of assessing how many have complied and if they haven’t, why.

Some owners appear to have absconded with the money. But others were coerced into paying off mortgages or were ripped off by unscrupulous contractors. Some were waiting to start repairs until they collected a separate hazard mitigation grant under another state-run, federally financed program, which didn’t start paying in earnest until late last year. Still others were caught short when the Small Business Administration swooped in at the closing table and intercepted their Road Home grants to pay off SBA disaster loans.

To start with, Road Home's flawed formula left homeowners in less marketable neighborhoods with insufficient grants to cover the cost of rebuilding. Next, the insufficient grants were further diminished by claims from mortgage lenders and by SBA. In many cases what's left is quickly eaten up by fly by night contractors. Certainly some folks had the resources or credit to run this gauntlet and come through okay but it doesn't look like a system designed to help most do that. And now the State wants to identify the people who couldn't so we all know who to blame.

Pretty neat although it still looks like that money is long gone by now.

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