A new investigative report has discovered a portion of the federal funds that were designated to help low-income Connecticut households repair their properties was allocated to wealthy homeowners in Fairfield County”™s Gold Coast communities.
According to an article published by Politico, the owners of 62 Gold Coast-based mansions worth more than $1 million each received federal aid to pay for Sandy-related repairs. The homeowners received a total of $6.4 million, or 15% of the $44 million that the U.S. Department of Housing and Urban Development (HUD) provided to Connecticut.
The Politico report found 31 of the 62 homeowners borrowed against the equity in their homes after the storm, while 18 received low-interest disaster loans from the U.S. Small Business Administration to pay for repairs ”“ the average loan was $200,500. But after the HUD-financed repairs were completed, 21 homeowners sold their properties, with an average sale price of $1.77 million ”“ even though the HUD funding program is supposed to prevent homeowners from making a quick profit by using federal aid.
At the same time, more than $1 million in home damage in Bridgeport did not receive any HUD funding.
HUD defended its actions, claiming in a statement that the department “recognizes that in high-cost real estate markets there may be an unmet housing need that extends to properties and areas with high market values.” The Connecticut Department of Housing also issued a statement insisting low-income household were given priority and “if there were available funds, then a higher income applicant could receive assistance.”
