Feds change stance on FEMA benefits

Finally, some good news for Hurricane Sandy victims: If you reopened your case with the Federal Emergency Management Agency, and the agency determines that you are indeed owed more money, you do not have to return the first $20,000 of the additional funds as a duplication of benefits.

After extensive lobbying by senators representing New York and New Jersey, the U.S. Department of Housing and Urban Development agreed to allow Sandy victims to keep the rebuilding funds. In a statement, Harriet Tregoning, HUD’s principal deputy assistant secretary of community planning and development, said, “These families have suffered enough, and shouldn’t be further victimized through no fault of their own.

“It’s great news for Sandy victims,” said Sen. Chuck Schumer. “It hopefully will set a precedent for future recoveries.”

Schumer also said he had reached a deal with FEMA that would extend the deadline for Sandy victims to reopen their flood insurance claims by one month. The original deadline was Sept. 15. Now those who feel they were shortchanged by their flood insurance settlements have time to file for a claim review.

Many people did not file for additional money out of fear that they would just have to give it back to the government as a duplication of benefits.

HUD is bound by the terms of the Stafford Act, a federal law that prevents people from receiving financial assistance from an agency or program — an insurance settlement, for example, or government aid — when they have already been helped by another such entity. If a homeowner receives money to repair drywall, and then files to reopen his flood insurance claim and receives more money for the same drywall, he must return it to the government.