Hurricane Katrina

Federal housing grants delayed

JACKSON - Gov. Haley Barbour says the release of federal housing grants for Hurricane Katrina-damaged homes has been temporarily delayed.

"I thought this was going to be the week we started paying out money," Barbour said Thursday during a briefing for lawmakers about storm recovery and rebuilding efforts.

Barbour said about 16,000 homeowners have qualified for the federal grants of up to $150,000 each. However, Barbour said the program has a period for comment before the money is released, and a filing by the National Mortgage Bankers Association has held up the money.

Barbour said the association has requested that mortgage bankers have control of the money rather than the individual homeowners. Barbour said no state financial institution is listed in the comment documents filed June 16.

"We're preparing our response to that. We don't think there's anything to it," Barbour said. "We hope we're on hold a few days."

The grants were approved by Congress as part of the Community Development Block Grant program, a long-standing program that traditionally has helped low- and moderate-income people.

The grants are available to people in Hancock, Harrison, Jackson or Pearl River counties who owned their homes when Katrina struck Aug. 29 and had homeowner insurance. They must have had water damage, despite living outside of what was then the federally designated flood plain.

The period to apply for the grants ended in early June.

Barbour said the state has presented another plan to the U.S. Department of Housing and Urban Development for low- to moderate- homeowners, regardless of whether they have insurance or were in the flood plain. Registration already has begun for the program, dubbed the Phase II plan. So far, about 3,200 people have signed up, Barbour said.