WASHINGTON – FEMA settled a disagreement Wednesday with one of the nation's largest mortgage lenders to help 1,500 Hurricane Katrina families into rent-free houses for 18 months.
Responding to a complaint by a Democratic congressman, the Federal Emergency Management Agency said it would take Fannie Mae up on its offer to provide 1,500 homes — many of them single-family houses — to Katrina evacuees.
"We have struck an agreement with Fannie Mae, which removes some of the barriers toward placing people in the homes," said FEMA spokesman Butch Kinerney. He said the agreement "protects the privacy of the evacuees but also gets them into some really exceptional housing before the holidays."
FEMA began calling eligible families Wednesday, "so we're going to be moving people fairly quickly," Kinerney said.
The decision reflects an about-face in negotiations between FEMA and Fannie Mae that began two months ago. Fannie Mae is the second largest financial institution the United States.
Fannie Mae offered the housing units — located in nine Southern states — to FEMA, state agencies, charities and other relief groups seeking temporary homes for evacuees. But the mortgage company wanted to continue letting potential buyers in to view the homes — a provision that FEMA said would violate evacuees' privacy.
Last Friday, Rep. Bennie G. Thompson, D-Miss., complained that FEMA was failing to provide housing for evacuees after setting a Dec. 1 deadline to stop paying bills of an estimated 53,000 families still living in hotels following the Aug. 29 storm. Earlier this week, FEMA pushed the deadline back to Jan. 7 for evacuees in the 10 states with the largest evacuee populations.
Thompson is the top Democrat on the House Homeland Security Committee. His complaint spurred FEMA and Fannie Mae to settle the privacy concern that Kinerney said "is no longer an issue."
Fannie Mae spokeswoman Janice Walker did not know specifics of the agreement but said that "discussions with FEMA have resulted in an agreement to help house the families identified by FEMA, and we look forward to working with them on an ongoing basis to place evacuees in our properties."
The Fannie Mae units are in nine states: Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, Oklahoma, Tennessee and Texas.
FEMA began contacting families Wednesday to put them in 200 homes that are immediately available, Kinerney said. It was not immediately clear how FEMA would select the 1,500 families from tens of thousands who need homes, he said.
"We'll try to match them up, city by city and county by county," he said.