[StBernard] Seven Louisiana parishes to ask again for FEMA loan forgiveness

Westley Annis westley at da-parish.com
Wed Sep 29 10:07:07 EDT 2010


Seven Louisiana parishes to ask again for FEMA loan forgiveness

by Doug Mouton / Northshore Bureau Chief
wwltv.com
Posted on September 28, 2010 at 5:30 PM

Updated yesterday at 6:35 PM

Thursday, leaders from seven Louisiana parishes will travel to Washington,
DC to ask for forgiveness of their FEMA Community Disaster Loans.

St. Tammany, Jefferson, Orleans, St. Bernard, Plaquemines, Washington and
Cameron Parishes will all send representatives.

U.S. Senator Mary Landrieu coordinated the meeting between the parish
leaders and FEMA Administrator Craig Fugate.

At issue, whether FEMA will force parishes, law enforcement agencies, school
districts, and municipalities to pay back money borrowed in the aftermath of
Hurricanes Katrina and Rita.

The City of Slidell was hit hard back on August 29, 2005, and borrowed $2
million through FEMA's Community Disaster Loan program.

"We were between a rock and a hard place," Slidell Mayor Freddy Drennan
said Tuesday. "We had to do what we had to do at the time, and of course,
stepping up and making the $2 million loan was the right thing to do at the
time."

Mayor Drennan was Slidell's Police Chief at the time.

He said, the loan was used to make payroll and to get Slidell up and running
quickly.

In the history of the Community Disaster Loan program, FEMA has forgiven 96
percent of the loans, but thus far, they have not forgiven many Katrina and
Rita loans.

Louisiana leaders will try to convince FEMA that their formula for loan
forgiveness doesn't fit for Katrina and Rita.

FEMA studies revenues from a three-year period after the loan was taken.
According to St. Tammany leaders, sales tax revenue spiked during that
period, as people moved home and rebuilt. They will ask FEMA to consider
looking at a five-year period, which would allow them to qualify for
forgiveness.

"The formula that FEMA is using now is actually hurting us," Mayor Drennan
said. "It's actually going against the City of Slidell because of our hard
work."

In addition to Slidell's $2 million loan, St. Tammany Parish borrowed
roughly $12 million. The St. Tammany Sheriff's Department borrowed close to
$9.5 million, and the St. Tammany School System took out a loan for $68
million.

"They're called Community Disaster Loans," St. Tammany School Superintendent
Trey Folse said Tuesday. "That's exactly what they were at the time. We
felt the money was necessary to get our school system up, and we knew when
the system was up and running, it would certainly help the parish get up and
running. We were hearing that from everyone."

According to Folse, the loan helped the school system make payroll and get
temporary facilities up and running quickly.

The rapid reopening of the St. Tammany School System is considered the major
catalyst for the almost immediate re-population of the parish.

Folse will be one of the northshore leaders meeting with Fugate Thursday.

"I think we need to be realistic now," Folse added. "We've asked a few
times before and we've been told no. I think we need to go back to the
table and re-adjust what we're asking for and hopefully get a yes from the
right people."

If FEMA says no again, northshore leaders expect to ask for payment
extensions, and to be allowed to pay the loans back over time.

For now, however, both Folse and Drennan said they hope FEMA will take into
account its own history of loan forgiveness.




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