Saturday, March 29, 2008
Imagine that your home was reduced to mold-covered wood framing by Hurricane Katrina. Desperate for money to rebuild, you engage in a frustrating bureaucratic process, and after months of living in a government provided-trailer that gives off formaldehyde fumes you finally win a federal grant.
Then a collector announces that you have to pay back thousands of dollars.
Thousands of Katrina victims may be in the same boat.
A private contractor under investigation for the compensation it received to run the Road Home grant program for Katrina victims says that in the rush to deliver aid to homeowners in need some people got too much. Now it wants to hire a separate company to collect millions in grant overpayments.
The contractor, ICF International of Fairfax, Va., revealed the extent of the overpayments when it issued a March 11 request for bids from companies willing to handle "approximately 1,000 to 5,000 cases that will necessitate collection effort."
The bid invitation said: "The average amount to be collected is estimated to be approximately $35,000, but in some cases may be as high as $100,000 to $150,000."
The biggest grant amount allowed by the Road Home program is $150,000, so ICF believes it paid some recipients the maximum when they should not have received a penny. If ICF's highest estimate of 5,000 collection cases � overpaid by an average of $35,000 � proves to be true, that means applicants will have to pay back a total of $175 million.
Then a collector announces that you have to pay back thousands of dollars.
Thousands of Katrina victims may be in the same boat.
A private contractor under investigation for the compensation it received to run the Road Home grant program for Katrina victims says that in the rush to deliver aid to homeowners in need some people got too much. Now it wants to hire a separate company to collect millions in grant overpayments.
The contractor, ICF International of Fairfax, Va., revealed the extent of the overpayments when it issued a March 11 request for bids from companies willing to handle "approximately 1,000 to 5,000 cases that will necessitate collection effort."
The bid invitation said: "The average amount to be collected is estimated to be approximately $35,000, but in some cases may be as high as $100,000 to $150,000."
The biggest grant amount allowed by the Road Home program is $150,000, so ICF believes it paid some recipients the maximum when they should not have received a penny. If ICF's highest estimate of 5,000 collection cases � overpaid by an average of $35,000 � proves to be true, that means applicants will have to pay back a total of $175 million.
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