Mississippi Groups Sue HUD, Objecting to Use of Katrina Aid for Port Instead of Housing

By Spencer S. Hsu
Washington Post Staff Writer
Thursday, December 11, 2008

Mississippi civil rights and housing groups sued the U.S. Department of Housing and Urban Development yesterday to stop the distribution of nearly $600 million in Hurricane Katrina relief aid to expand the Port of Gulfport, as sought by Gov. Haley Barbour (R).

Filed in federal court in the District, the lawsuit alleges that the money is part of $5.5 billion approved by Congress for Mississippi after the August 2005 storm -- emergency relief that was supposed to pay largely for affordable housing. But HUD granted waivers allowing the state to use 21 percent of the money for low-income housing, instead of 50 percent as required for Katrina aid channeled through the Community Development Block Grant program, plaintiffs charged.

The filing escalates a long-simmering fight in Mississippi over how much Katrina relief money should go to help house poorer residents and how much should go to boost employment and economic development. The Gulfport port project has become a symbol for both sides.

The port lost about 700,000 square feet of storage facilities and other infrastructure in the storm, and regional leaders have long hoped for a port expansion that would position the area to benefit from the long-term growth of Gulf Coast shipping. But opponents say low-income families are losing out to business interests, and they contend that the port's storm losses were partially covered by insurance and other federal aid and that its growth should be funded by bonds and other sources.

"Though the storm did not intentionally discriminate, the damage did reveal the impact of decades-long discrimination against poor, African American people who were already living in substandard housing," said Derrick Johnson, president of Mississippi's NAACP chapter, a plaintiff in the case along with the Gulf Coast Fair Housing Center and four individuals. "For the first time in our state's history, we have the resources to right this wrong."

HUD spokesman Brian Sullivan said agency lawyers have not seen the lawsuit and had no comment.

In a January letter to Barbour, then-HUD Secretary Alphonso R. Jackson wrote that he shared concerns that the port expansion "does indeed divert emergency federal funding from other more pressing recovery needs, most notably affordable housing."

Congress, however, "allows me little discretion," Jackson wrote. He approved the funding shift before resigning in April.

Barbour's office released a statement saying the port project is part of the state's recovery program that was vetted by Congress. "It's always been in the plan," Barbour said. "Restoration of the Port of Gulfport is critical to recovery of the Gulf Coast from the worst natural disaster in American history."

© 2008 The Washington Post Company