FEMA abandons clawbacks on Sandy victims

In what local officials and advocates are calling a win for Hurricane Sandy victims, the U.S. Department of Housing and Urban Development announced on Wednesday that any additional flood insurance proceeds up to $20,000 will not be treated as duplicative.

For months, local and federal officials called on the Federal Emergency Management Agency to waive millions of dollars in disaster relief funding that the agency had ordered Hurricane Sandy victims to pay back.

FEMA was seeking to recoup $6.79 million from nearly 1,000 local homeowners, claiming that they were mistakenly overpaid, and sent out demand letters late last year to storm victims stating that they had received duplicate or erroneous payments.

“I applaud HUD for making the right decision not to claw back grant funds from Sandy victims,” Assemblyman Todd Kaminsky said in a statement. “In my joint letter with the City of Long Beach to HUD, we highlighted that Sandy victims have suffered enough and deserve a break. This will provide much-needed relief for so many families who are still struggling.”

At a press conference in Long Beach in July, where she was joined by local officials, U.S. Rep. Kathleen Rice said that in New York’s fourth congressional district, which she represents, FEMA was looking to recoup more than $1.5 million from residents in Long Beach alone, more than $600,000 from residents in Freeport, and more than $555,000 from residents in Oceanside.

FEMA also announced Wednesday that it has extended the deadline for flood insurance policyholders to submit their Sandy claims for review if they suspect they were underpaid after the storm. The last day to submit claims is now Oct. 15.