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Wednesday, March 8, 2006
Report: Katrina evacuees put in luxury hotels
USA TODAY
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The Federal Emergency Management Agency failed to set cost controls on hotel room rentals for Hurricane Katrina evacuees, an omission that led to "excessive" bills, a report says.
The agency was still paying up to $364 a night for some rooms on Dec. 7, more than three months after Katrina hit, says the report this week by the Department of Homeland Security Office of Inspector General.
The payments covered stays at the Hilton San Diego Gaslamp Quarter, a hotel that advertises an outdoor heated pool, and the InterContinental New Orleans, a luxury hotel that recovered and reopened after Katrina, the report shows.
The inspector general is examining whether unidentified hotels in Ontario, Calif.; Niles, Ill.; and Orlando, Fla., boosted normal rates for Katrina evacuees, the report adds.
The findings expand on the inspector general's disclosure last month that the emergency agency paid up to $438 a night to house Katrina evacuees in luxury hotels in New York City, Chicago, and Panama City, Fla.
The accommodations were among at least 773 rooms for which the emergency agency paid more than $147,935, or an average of $191 a night, the report says.
That represents a fraction of the estimated $560 million the agency spent on tens of thousands of rooms.
The agency rented the rooms through a contract with Corporate Lodging Consultants, which was required to "endeavor to ensure reasonable lodging rates."
The contract included a $60-a-night estimate per room.
But the deal "did not contain any incentives for the contractor to achieve these estimated costs or penalties for failing to achieve the estimated costs," the oversight report says.
Danielle Brian, executive director of the watchdog group Project on Government Oversight, concedes that the agency faced an unprecedented evacuation of a major city with no prospect of immediate return.
Still, he says, the agency acted "without common sense."
"There should be adequate carrots and sticks to make sure the government is paying Econo Lodge prices rather than Paris Hilton prices," says Keith Ashdown of Taxpayers for Common Sense, another watchdog group.
Agency spokeswoman Nicol Andrews says the costly rooms were in some cases the only option but were "the exception, not the rule."
"In a situation where hours can make a difference, FEMA cut through red tape to ensure everyone had a place to stay," she says.
Andrews adds that the average nightly price of hotel rooms was $60 during the recently ended program.
The report urges the agency to modify the contract to add cost incentives and penalties for rentals, and to review the hotel-selection process to prevent excessive costs.
http://www.tucsoncitizen.com/news/national/030806b1_GNS-KATRINA-HOTELS