New Orleans The Louisiana Recovery Authority has not been able to track compliance on Road Home recovery grants to homeowners to rebuild, but fortunately a non-profit, Beacon of Hope, did so though at least in the affluent area of Lakeview, but it’s not good news.  Seems of 1800 homes they surveyed nothing has been done in 500 of the lots, which are either now vacant or still in post-Katrina condition.  In about 50 of those situations, the homeowners signed covenants with the state that should have meant that within 5 months they were finished and home.  Not happening.

This is going to be a mess and the finger pointing will be hard, but probably not productive.  Ex-Governor Kathleen Blanco (D) had been doling the money out on an installment basis as various rebuilding steps were completed.  This was painfully slow and rightly occasioned huge complaints and delayed recovery because the bureaucracy, subcontracted out to private vendors, was hopeless and inefficient.  George Bush’s HUD muscled up Blanco so that finally homeowners got upfront, complete grants to rebuild.

The original homeowner signed a covenant with the state that gave them a fixed period of time to get the work done.  Some may have sold their lots, taken the money, and run.  It is unclear that the covenants are enforceable on anyone but the original owner, who is likely a long gone pecan.

Given the Great Recession and everything else that is happening there could be lots of valid reasons for a lack of progress.  Unemployment would be one, but the enduring credit crunch is likely another even in the relatively more well to do area of Lakeview because in most cases homeowners were still unlikely to have cobbled together enough to rebuild at current costs for labor and materials.

The Times-Picayune quoted the LRA director saying they were focusing on “case management,” meaning that they were trying to work with people rather than gin up the legal machinery to try and get the money back.  Despite the good service the Beacon of Hope people have done here, it seemed in the paper that they were both angling for a state contract to monitor compliance and advocating a “get tough” policy with rigid timelines.  Someone needs to be keeping up with the number without a doubt but to me this situation – and the recovery itself – needs a “get smart” policy more than a “get tough” program.

Homeowners can ask for extensions of one, two, or I suspect more years for good faith and good effort.  The state can pick out one or two scofflaws among the posh Lakeview crowd to send a signal about being serious, but it will take a calm voice and steady hand to help and maybe even more than that to bring people back to the neighborhoods and New Orleans in this economy, and that’s the best prescription for success now.