For Katrina Victims, a Rocky 'Road Home'

Aug. 28, 2007 — -- After Hurricane Katrina ravaged New Orleans and the Gulf Coast, President Bush promised to "do what it takes" to bring swift relief to the devastated areas and help storm victims rebuild their homes and their lives.

But, two years later, an ABC News investigation has found that the main government program designed to bring Louisianans home and help them rebuild is in big trouble. Tens of thousands of Katrina victims in the state have yet to receive any money from the Road Home grant program -- and it's not clear if some of them ever will.

For many of the 184,000 Katrina victims who put their hopes in the grant program, the Road Home has been paved with insult, frustration and bureaucracy. Only 44,000 checks have been distributed, and the director of Louisiana's disaster recovery unit warns that some 60,000 families may not get paid at all unless the state gets billions more in federal aid.

"It's been a nightmare," said Brenda Chipanelli, whose home was destroyed during the storm. Chipanelli and her husband, Chip, applied for Road Home grants to repair their house, but have not received any money from the program despite numerous phone calls, e-mails and visits to the program offices.

But while the Chipanellis and many others like them struggle to rebuild their homes, the private contractor that administers the Road Home program has been doing just fine. ICF International has been paid $300 million so far to administer the grants.

The company's top three executives were paid more than $2 million in bonuses last year.

"I'm concerned that New Orleans is running out of time," Chipanelli said. "I'm sorry, we need the money for the city. I mean, we really do."

Bureaucratic Delays

The Chipanellis told ABC News that they have been subject to endless delays and forced to jump through dozens of bureaucratic hoops to get the Road Home grant money. Brenda Chipanelli said she faced 60 steps required by Road Home, including having her photograph and fingerprints taken – which many call insulting. Under pressure from critics, the program has reduced the number of procedural steps applicants must take to 42.

They received a promising letter from Road Home in January, but still have not received any money. Even more aggravating, with no apparent explanation, the Chipanellis' next door neighbors Mike and Jan Simms applied for a grant months after they did and have already been given money.

"They're a swell couple. It's a heartbreak just to see them go through the anxiety," Mike Simms said.

The Chipanellis have visited Road Home offices numerous times, once accompanied by ABC News, and have kept pages and pages of records of their phone calls and e-mail exchanges with the program administrators -- all to no avail.

"A lot of the people in the office, it's like dealing with children," said Chip Chipanelli. "You know, you ask this guy he points to this guy. It's like when you come home and one of your kids knocks the vase over."

Mike Taylor, director of Louisiana's disaster recovery unit, said the Road Home program has been inundated with about 50 percent more applications than originally expected. He said the program was getting on track and that the bottleneck is now clear.

"We are working as hard and as fast as we can to improve the program and get the dollars out there faster," he said.

Taylor defended the program, saying the bureaucratic steps were justified by the need to prevent fraud.

Louisiana has also threatened ICF with penalties if the money doesn't start flowing.

ICF Senior Vice President Douglas Beck said the program was on track, despite the unexpected number of grant applications. The company was awarded the Road Home contract in September 2006.

Road Home "is the largest housing reconstruction program in response to a disaster in the nation's history and was expected, in the design of the program, to take two years to distribute money," he said.

60,000 Families May Be Out of Luck

But Taylor said the program is expected to run out of money in late December. "I would challenge anyone who questions the need for these dollars to come to Louisiana and see what we're faced with," he said.

If the state doesn't get more money from the federal government, he warned, some 60,000 families could be left unpaid.

The Chipanellis could be among them.

"There's a chance we won't get our money at all," said Chip Chipanelli.

"If you can spend billions and billions a month on a war halfway across the world, you can certainly spend a few billion in the city of New Orleans and put one of your favorite cities back together."

With reporting by Lauren Pearle

For more information or for help with the Road Home program, visit http://ChatUsHome.com.