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FEMA Goes on Spending Spree for Housing

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September 29, 2005 by   Leave a Comment

The magnitude, and the ramifications, of an unprecedented buying spree by the Federal Emergency Management Agency (FEMA) for emergency housing was chronicled in Wednesday’s (Sept. 29) Chicago Tribune. The following is the story in its entirety:
Four hundred squat white trailers sat on train cars in the Norfolk Southern rail yard in Elkhart, Ind., Tuesday, waiting for the long trip to the Gulf of Mexico. In Nappanee, 15 miles away, 200 or more are produced each day.
This is what $521 million in Federal Emergency Management Agency contracts looks like: Gulf Stream Coach Inc.’s bare bones Cavalier trailers. They have a steel chassis, a wood frame and white aluminum siding. There’s a couch, a kitchen table, a three-burner stove, a double sink and a refrigerator. Each has an adult-size bed and a set of bunk beds, and they can be hooked up to air conditioning and sewer and water lines. A toilet, a shower, and a place to wash your face complete the unit.
Demand couldn’t be greater.
“As fast as we can put them on there, they’re moving them down there,” said Gulf Stream marketing director Steven Lidy, watching the company’s trailers being hitched for the ride to the rail yard Tuesday.
The giant award to Gulf Stream for 50,000 housing units is part of unprecedented federal spending to answer one of the basic needs caused by the hurricane disasters of Katrina and Rita: providing an estimated 600,000 displaced people with housing.
The trailers are emblematic of the scale and scope of the federal effort in the region. The spending is a window into the urgent, sometimes haphazard contracting process, much of it done with little or no competitive bidding, like Gulf Stream’s contract.
In the nearly one month since Katrina hit Louisiana, Mississippi and Alabama, the federal government has passed out billions of dollars in contracts. At least $1.15 billion of that money has gone toward travel trailers and mobile homes, which are destined for new, temporary towns throughout the Gulf Coast region.
FEMA defends its pace of spending as necessary in the face of overwhelming need. But critics worry that the nearly unchecked spending will invite graft and bungling and that the new trailer parks will become unsightly ghettos.
“It’s one thing if you are talking about two weeks, three weeks or a month,” said Rep. Barney Frank (D-Mass.), who argues that rental vouchers are a better long-term solution. “People need more than a bed and toilet. After a couple weeks, that’s not enough.”
Such problems are on display in FEMA City, a mobile home park that was erected outside of Punta Gorda, Fla., for evacuees of Hurricane Charley. More than a year after the storm, nearly 500 mobile homes remain occupied, and residents complain of chronic drug-dealing and crime, isolation and few affordable rental options.
As a measure of the problem in the gulf region, consider that FEMA bought more trailers from one dealer in eastern Indiana than it did to provide all the trailers in Punta Gorda.
Ron Sherman, FEMA’s housing task force leader, has seen the problems in Florida. He said his agency is working to avoid the pitfalls of FEMA City by encouraging evacuees to accept three months’ rent money to take apartments in new locales.
But if evacuees wish to remain in the area and move into trailers, he promised that the new trailer parks will be more aesthetically pleasing and better integrated into the community.
“If we put all of the emphasis on trailers as the only housing answer, that’s the wrong answer,” Sherman said. “This should be only one tool in our toolbox. . . . We prefer they go with financial assistance.”
FEMA is purchasing about 116,000 temporary units, Sherman said. About 80% of those are travel trailers and the remainder are mobile homes, he said. Travel trailers are pulled behind cars and trucks, while mobile homes tend to be larger, more permanent structures.
FEMA teams have spent three weeks looking for locations for the trailer parks – large parcels of land near water, sewerage and electricity – and they plan to open at least 25 sites in Louisiana, seven or eight in Mississippi and one in Alabama. FEMA hopes to limit the number of trailers to fewer than 500 in each park.
“These are going to be longer term, perhaps, more than anybody would like,” he said, explaining why they were spending more time designing the parks to feel like villages.
It won’t work, predicted Susan Popkin, a principal research associate at the non-profit Urban Institute.
“You can’t assemble all of the things that you need to make these good places to live,” she said, ticking off parks, schools, stores, health-care facilities and transportation.
Popkin said FEMA’s approach will re-create the concentration of poverty that crippled the evacuation of New Orleans.
She said evacuees should be pushed to accept rental vouchers and be given assistance to look for housing in cities in the region, with the aim of dispersing poverty.
The first trailer park for Katrina evacuees, set up in Baton Rouge, La., could be ready for occupancy by Monday (Oct. 3), according to FEMA’s Sherman.
About 14,000 trailers were bought directly from dealer lots, and vary in size at retail prices for at least $330 million worth of FEMA’s purchases. A sampling of dealers contacted Tuesday said they discounted prices to the federal agency, although documents for price comparisons were not immediately available.
The trailers that were ordered from manufacturers sleep four people and are 8 feet by 32 feet. They have a bathroom, kitchen and eating area and are to be attached to water, sewer and electricity.
In addition to Gulf Stream’s huge factory order, retail dealers of RVs scored multimillion-dollar deals. In Indiana alone, Tom Stinnett Holiday RV in Clarksville was awarded a $37 million contract for trailers, and Tom Raper RV in Richmond sold FEMA $14.6 million of its inventory.
The mobile homes will be reserved for larger families and generally will be located closer to the damaged areas, Sherman said.
The best option, Sherman said, is to put travel trailers in a driveway or side lot of a family’s property while their home is rebuilt. FEMA estimates that 10 percent of the trailers used in Louisiana will be placed on home sites while the owners rebuild; 20 percent will be moved to existing trailer parks, where FEMA will lease the space; and the remaining 70 percent will be dropped off in the newly constructed trailer sites.
The program for buying trailers and mobile homes is mostly an expanded version of the plan used after Hurricane Charley.
FEMA uses trailers for temporary housing because they are readily available and also because apartments often are scarce in the areas affected by the storm.
Sherman said he couldn’t estimate how many evacuees would choose rental vouchers or trailers, but he noted that the number of trailers was limited. Evacuees who remain in hurricane shelters will be given top priority to move into trailers, followed by those who remain living with friends or relatives, he said.
FEMA has been calling evacuees who registered to assist them with temporary housing, and officials are urging others to call with updated mailing and banking information. Once the evacuees move out, which could be in 18 months or more, FEMA plans to sell most of the trailers at auction and keep some in inventory.
But like Massachusetts’ Frank, Sen. Susan Collins (R-Maine) worries that FEMA hasn’t thought through the implications of concentrating large numbers of evacuees in cramped housing.
“I have a lot of concerns … I’m not sure FEMA has a coherent plan,” Collins said. “I’m not sure that cities of manufactured housing are the answer.”
Bob Hebert, director of recovery services in Charlotte County, Fla., has seen the problems created by housing people in trailer parks after a hurricane. While he describes the trailers as a “lifesaver” for evacuees immediately after the storm, he said they can quickly turn into a nightmare if there are too many of them and they are isolated from the community.
“The first three or four months, it’s an adventure,” Hebert said. “But you quickly become an entitlement community. . . . There needs to be a plan to break it down very quickly.”

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