Fudge on HUD debt relief for homeowners impacted by Hurricane Katrina: ‘We ended a nightmare’

The Biden-Harris administration has moved to provide debt relief for Louisiana homeowners impacted by Hurricane Katrina nearly 20 years after the deadly natural disaster left mostly Black communities devastated.

“We ended a nightmare that has been going on for almost 18 years,” Housing and Urban Development Secretary Marcia Fudge told theGrio about the corrective action taken to help thousands of Katrina survivors who rebuilt their homes and their lives after the August 2005 tragedy.

While on the ground in Louisiana to announce the end of the Hurricane Katrina-era Road Home Program, Fudge said during an interview: “This is one of the most significant things I believe I have done as secretary of HUD.”

The federally-funded program that was administered by the state of Louisiana provided grant money to help Louisiana residents rebuild or sell their homes that were severely damaged by Hurricanes Katrina and Rita. Disbursements for each homeowner grant will be capped at $30,000.

Fudge said the latest action by HUD, which takes effect in April 2023, is about “equity and making things right.”

HUD officials say the debt forgiveness for the Road Home Program will potentially impact up to 3,300 Louisiana homeowners. In the aftermath of Katrina, almost 130,000 Louisiana residents received more than $9 billion through the Road Home Program. 

The Bush administration provided much of the billions of dollars to impacted homeowners. Former Bush HUD Secretary Alphonso Jackson told theGrio that the administration wanted to focus their recovery efforts on homeowners; however, Bush officials later discovered that those most affected by the hurricane were renters.

“Many of the people lived in subpar homes that they were renting,” said former Secretary Johnson. Though the recent move by HUD appears to be for homeowners and not renters, Johnson said he supports Secretary Fudge’s efforts to try to “make those persons whole.”

Today, Biden HUD officials feel the debt forgiveness will give impacted families much-needed relief and financial freedom. It would allow them the ability to make repairs to their homes, or even sell their property without the worry about liens or payment plans. 

As Jackson notes, “At some point in time. You’ve got to forgive those debts; otherwise, it will stay on the books.”

The debt relief from the Road Home Program is an economic win for those impacted, says Secretary Fudge.

“People are saying now we can get our houses finally fixed … a lot of them never did the kind of renovation and rehabilitation that they could have because they didn’t have the money all these years,” she explained. “Many did not want to do it because they never knew whether they would keep their home.” 

Secretary Fudge is slated to make another announcement later this week in HUD’s continued efforts to expand homeownership; however, she was tight-lipped on details.

“Home is the thing that creates generational wealth,” she said. “And without it, most people have nothing.”

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