FEMA Does It Again: Overpays $177 Million in Hurricane Relief
Policy + Politics

FEMA Does It Again: Overpays $177 Million in Hurricane Relief

REUTERS/Brendan McDermid

Another year, another disaster at the Federal Emergency Management Agency. 

The federal agency known for botching disaster relief accidentally overpaid upwards of $177 million to hurricane victims that could have instead been covered by their personal insurance.

That’s according to a new report by the Department of Homeland Security’s Inspector General, which reviewed disaster relief payments made by FEMA between 2004 and 2005 to victims of Hurricane Katrina and Hurricane Wilma.

Related: Auditors Still Finding Misused FEMA Katrina Funds

During that time period, the federal government handed out a total of about $4.4 billion in assistance. The auditors said the agency did an “inadequate” job of evaluating who was eligible to receive funds. The agency did not check who was covered by their personal insurance -- a mistake that is costing taxpayers nearly $200 million in unnecessary expenses.

What’s worse—the IG said that FEMA knew about these deficiencies in its insurance review process but did not correct them. Since 2010, the auditors said the agency was aware of “potentially significant issues with insurance adjustments relating to disaster assistance in 2004 and 2005." 

The auditors suggest that FEMA tries to recoup the funds, though it may be difficult given how long ago the payments were made.

Related: FEMA Still Doesn’t Know Where It’s Going 

FEMA is already trying to recoup other funds from Hurricane Katrina that were misused or abused. Earlier this year, the auditors found that $4.7 million in federal grants given to Hancock County, Mississippi have either not been used appropriately or not been used at all. The agency severely botched disaster relief during Hurricane Katrina, erroneously handing out millions in disaster relief to the wrong people.  Several years after the storm, FEMA asked recipients of the money to return it to the government—long after it had been spent.

The same thing happened during Hurricane Sandy in 2012. Now the agency is again in the complicated process of trying to recoup around $5.8 million dollars that it paid accidentally to people more than two years ago.

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