The U.S. Department of Housing and Urban Development (HUD) has decided it will not force thousands of New York and New Jersey homeowners to repay federal disaster recovery funds following a decision by the Federal Emergency Management Agency (FEMA) to increase flood insurance claim payments to families it initially underpaid following Hurricane Sandy.
According to HUD, additional flood insurance proceeds up to $20,000 will not be subject to a duplication of benefits review or collection. This will eliminate the need for HUD grantees to reclaim assistance from these households, or to repay those funds through non-federal sources. To date, three out of four National Flood Insurance Program (NFIP) claimants received less than $20,000 in additional compensation from FEMA and would not face any possible repayment. Families who received or will receive more than $20,000 in additional flood insurance payments will still have the opportunity to demonstrate the added claim payments address legitimate unmet needs and, therefore, are not duplicative.