The two senators from New York this week called on the U.S. Department of Housing and Urban Development and the Federal Emergency Management Agency to forego any efforts to claw-back National Flood Insurance Program insurance money from Superstorm Sandy victims who have recently received additional flood insurance payouts.
After it was exposed this year in several reports, FEMA has sought to rectify the widespread evidence of systemic and potentially fraudulent flood insurance claims to Sandy victims. However, Schumer and Gillibrand said, HUD has indicated that it will recoup new NFIP settlement funds from recipients that also received Community Development Block Grants—Build it Back or NY Rising grants—for the portion of the settlement amount that it considers a “duplication of benefits.”
In their letter to HUD and FEMA, the senators explained that many of the Sandy victims affected by the “unfair policy” have already been forced to wait nearly three years to be appropriately compensated, and have had to endure significant hardship as a result of “incompetence, and even potential fraud.”
Given these extraordinary circumstances, Schumer and Gillibrand said, HUD should waive the “duplication of benefits” recoupment policy for Sandy victims that may receive an additional payment from FEMA.
“Once again, the feds are penalizing our cash-strapped Sandy victims, who have already endured years of aggravation and unjustified denial of flood insurance claims, by requiring them to give back the belated NFIP settlement funds they so desperately need and deserve,” Schumer said on Tuesday. “We should be maximizing the support that homeowners receive and must use every tool in our toolbox to ensure that homeowners keep any aid they receive. I strongly urge HUD to waive its ‘duplication of benefits’ recoupment policy in this unique situation, given the circumstances surrounding these victims, including evidence of widespread fraud and years of hardship.”
Gillibrand added, “We need to make [homeowners’] work easier, not add to the aggravation.”
Asked for a reaction to the senators’ request, a HUD spokeswoman said, “HUD is mindful of the duplication of benefit issues presented in the settlement discussions on National Flood Insurance Program claims and is working closely with FEMA and the grantees distributing Community Development Block Grant disaster recovery in response to [Superstorm] Sandy. The department is committed to a fair and rapid resolution of this unique and unfortunate situation.”
By Michael V. Cusenza