Road Home Contractor Faces Penalties

Reported by: Associated Press

State officials are threatening to withhold three million dollars in compensation from the company managing the Road Home program for hurricane victims, unless possible errors and incomplete documentation in more than 600 aid applications are resolved.

State officials say ICF International has 14 days to fix problems in 607 aid cases or the state will keep $5,495 for each one that is not addressed.

ICF promised swifter action, and indicated that the problems existed in a small percentage of cases. Spokeswoman Gentry Brann says the company fully supports the state's effort to reconcile the less than one percent of closed files in question.

However, Chr istina Stephens, a spokeswoman for the Louisiana Recovery Authority, disputes ICF's percentage, saying problems were found in 66 percent of the 1,779 closed files the state reviewed.

Road Home, the flagship program to help victims of hurricanes Katrina and Rita rebuild their flooded homes, is financed by 10-point-3 billion in federal funds and has been blamed for the lurching recovery of Gulf Coast neighborhoods.

ICF's contract to run the program, valued at up to 912 million dollars, is being examined by the state in part because former Governor Kathleen Blanco approved raising the company's compensation by more than $150 million as her administration wound down in December 2006.

Stephens says the three million dollar performance penalty would be the largest leveled against the company since it won the contract in June 2006.

As of last week, 12,944 cases had been received by the Road Home appeals office. So far, 105,516 out of 154,945 eligible applicants have received assistance from Road Home.