Someone somewhere is making millions on FEMA's emergency housing trailers
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by James Varney,
New Orleans Times-Picayune
Jan. 21, 2006
Those displaced by Hurricane Katrina and seeking a temporary trailer don't get to kick the tires or discuss financing plans, but a look at the ultimate sticker price might make them wish they could: $59,800.
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That's the cost to taxpayers for the trailer's 18-month "life cycle," according to the Federal Emergency Management Agency. If FEMA offered the cash instead to hurricane victims, they might be able to spend the $3,322 per month in New Orleans on some housing more enticing than a box on wheels.
For example, quite a bit less would command the first floor of a building on Prytania Street in Uptown with two bedrooms and two-and-a-half baths, or a four-bedroom house in Kenner. A smidgen more would land them a sprawling, five-bedroom ranch in the tranquil woods of Madisonville, according to current listings.
The seeker would do even better if he could cash in what FEMA will pay for the life cycle of the larger mobile homes being used for housing in some areas. That pricier option comes in at $76,800 for the same 18-month period.
The cost includes the purchase, transportation, installation, maintenance, cleaning and disposal of the trailers, FEMA spokesman James McIntyre said.
Of course, if FEMA were to make $60,000 available to households that otherwise would occupy a trailer, homeowners might not opt to spend the money on rent. For example, the family could buy its own trailer and still have considerable cash on hand to contribute to rebuilding their wrecked home. Generally, the types of trailers FEMA buys retail for between $16,000 and $20,000, recreational vehicle dealers said.
FEMA officials also acknowledge that if they made direct cash payments of nearly $60,000 during 18 months to individuals or households instead of installing trailers, such an approach would have no effect on the agency's bottom line.
It would, however, be illegal -- current rules prohibit FEMA from writing such checks. The amount of money FEMA can grant directly to an individual or household is capped at $26,200. Trailer costs do not count against the total individual assistance, officials said.
An extrapolation of the numbers provided by FEMA provides an estimate of how expensive the trailers will prove as a temporary housing solution. In Orleans Parish, officials have estimated that they need at least 30,000 trailers to ease the housing crunch. That would translate to a final price tag of roughly $1.8 billion, and doesn't include the costs of tens of thousands more trailers needed throughout the metro area.
While the figures are surprising, they are considerably lower than those being bandied about the city these days. City Councilman Eddie Sapir said a developer and some others had whispered fantastic per-trailer FEMA sums to him.
"By the time the contractor is paid, the mileage to haul it here is paid, the gas is paid, everything, it's around $120,000," Sapir said.
In fact, Sapir made that charge at the City Council meeting Thursday, suggesting that the federal government was paying outrageous amounts for trailers when handing over the cash would be a better use of taxpayer dollars -- not to mention, a more efficient use.
"I'm just a country boy, but what I don't understand is why they don't just give the people $121,000 and let them start rebuilding their homes," Sapir said.
On Friday, he declined to say who provided him with the figures but insisted he wanted only to spark discussion, not point fingers.
"What I really want is for things like this to be checked out, and if I'm all wrong, great," he said Friday. "But if the house only costs $75,000 to rebuild, we could be saving money."
Even though Sapir's math doesn't match FEMA's numbers, the real numbers stunned some local housing experts.
"My God, that's unbelievable," said Jo Ann Centanni, an agent with Coldwell Banker, when told the trailer bill comes out to about $3,300 a month. "You can rent a four-bedroom house for less than that."
Centanni's own experience is a case in point. The Lakeview home she shared with her husband was obliterated in the post-Katrina floodwaters. But they managed to land a townhouse in Metairie for $1,700 a month, a fraction of the FEMA trailer cost.
Other professionals echoed her opinion. Asked if she could set a client up in style for $3,300 a month, Theresa DeJarnette at Prudential Gardner Realtors purred, "Oh, yeah." Just recently, DeJarnette said, she handled a lease in the 4600 block of Prytania Street, which she described as, "a big, old, charming, classic New Orleans house." The cost: $2,600 a month. At the moment, she has a unit available in the 7400 block of Freret Street for $3,000 a month.
The statistics associated with the trailers also seem dramatic compared with other FEMA payouts. For instance, the trailer costs dwarf the agency's rental reimbursement payments, a program that has begun to produce considerable grumbling from New Orleanians who lost their houses. For those lucky enough to find apartments, FEMA's first three-month allocation was $2,358, or $786 a month, but many residents say they are finding it difficult to receive a second allocation.
As originally published
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Commentary by Rebecca:
Ever lived in a mobile home? I grew up in one.
You can buy a comfy, multi-bedroom mobile home for a good chunk less than the cost of a $59,800 FEMA trailer. You can raise your family in a real mobile home, and if you give it proper maintenance, fifty years from now you can have the grandkids over for Thanksgiving dinner in the same mobile home.
These FEMA trailers are a joke. They're a little like mobile homes, in that they have a sink and a toilet and you're supposed to live in them. The difference is that these FEMA monstrosities are slapped-together, more flimsy than a mobile home, simply not built to last, and they're tiny -- my friend is living in one, and it's about 8' by 20', perhaps one and a half times the size of my bedroom in my family's mobile home.
So I wanna know, who's making these boondoggle FEMA trailers and selling them to the feds for $60k a piece?
And who's pocketing the kickback on this amazingly lucrative taxpayer swindle?
=Rebecca=
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