Video: FEMA's Katrina spending criticized

updated 12/22/2005 7:43:49 PM ET 2005-12-23T00:43:49

How well has the Federal Emergency Management Agency been spending all those billions put aside to help the victims of Hurricane Katrina? Critics say it is too little, too late. Only about $19.5 billion has been spent so far, out of the $62 billion earmarked by Congress.

According to a study by the Brookings Institution, that spending includes:
• $4.4 billion in direct aid to victims — both cash and rental assistance.
• $3.1 billion for trailers and mobile homes.
• $6.7 billion for debris removal and infrastructure repair.

"The big surprise here,” says Matt Fellowes, a Katrina reconstruction expert with Brookings, “is how little money has actually gone out the door. The demand on the ground is just absolutely immense today; unfortunately, that demand has not been met yet.”

Local officials, like Kevin Davis, president of St. Tammany Parish, complain that even the $20 billion obligated so far has had little impact where needed most. "We're not seeing those kind of significant dollars that would help our residents in our local parishes," Davis says.

St. Tammany Parish in Louisiana has received only 3,000 of the 20,000 trailers requested. One man NBC News talked to finally got one of them today. But two others aren’t so lucky. They're still living in a tent.

Others are living in cars.

Meanwhile, 7,000 trailers sit empty at the Hope, Ark., airport. FEMA says one reason is that most local officials have not approved trailer sites.

In hard-hit Slidell, La., NBC News found one business open. The owner found his own trailer.

"This is out of my own pocket. Nobody … you know FEMA … if I was to wait for FEMA … I don’t know when I would get a trailer."

Also at issue is whether money spent so far has been spent wisely.

It's costing as much as $140,000 each to buy and install trailers — many times more than other forms of housing assistance.

Government watchdogs have said no-bid contracts for things such as portable classrooms are causing taxpayers to pay too much.

Some, like Sen. Barack Obama, D-Ill., now propose a chief financial officer to monitor spending and say no to bad deals or, as Obama says, "Somebody who is watching how this money is spent before it goes out the door, as opposed to simply doing an audit afterwards when it's too late."

Some 600 federal investigators are in the gulf region doing audits and investigating possible waste and corruption.

And today, a frustrated Congress took $24 billion away from FEMA and sent it directly to gulf states and other agencies, hoping to speed the recovery.

Lisa Myers is NBC’s senior investigative correspondent.


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