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According to the Action Plan Amendment 9, the Louisiana Office of Community Development - Disaster Recovery Unit (OCD-DRU) has placed a hold on $682 million in HUD CDBG-DR grant funds.
This hold as explained by OCD-DRU director Patrick Forbes July 13, 2018 at the LA Task Force meeting is for homeowners with an active SBA loan. Mr. Forbes also seems to have included those that have cancelled their SBA Loan into this same group of homeowners. Mr. Forbes instructed homeowners to wait for Congress or HUD Guidance that would remove the SBA Disaster Loan from the homeowners duplication of benefits calculation.
We have cancelled our loan in its entirety from the Small Business Administration Disaster Loan Program. We have an SBA letter of cancellation as proof that our loan was cancelled. This cancellation was acknowledged by the SBA Disaster Loan Program processing department under the direction of James E. Rivera Associate Administrator SBA Ft. Worth, Texas.
According to the HUD Guidance published Nov. 16, 2011 we do believe the section that states funds not reasonably anticipated should apply to us and other homeowners that cancelled the SBA loans and should not be calculated as a duplication of benefits against homeowners that did not received assistance from the SBA. Our letter of cancellation from the SBA and the expired reinstatement period strengthens the fact that the SBA Loan is not anticipated as future assistance. Our household as well as others have cancelled and refused the SBA Disaster Loan assistance because of living expenses and household debt burden. The inability to repay the SBA loan makes SBA assistance unobtainable for disaster recovery.
According to the OCD-DRU there are an estimated 3,800 households that Declined, Cancelled and refused assistance from the SBA Disaster loan program. There are also an estimated 3,800 households that show the SBA approval status and loan amount as a duplication of benefits even though those households never received assistance from the SBA.
HUD Guidance 11-16-2011 76 FR 71060 Duplication of Benefits relates to our issue with the SBA cancelled loans as DOB and in the spirit this guidance offered by HUD we find the section that states "funds not reasonably anticipated" should identify the cancelled SBA Loans as such funds that are not anticipated to be received by the homeowner and we would like to not have our cancelled loans calculated as a duplication of benefits.
Our letter of cancellation from the SBA and the expired reinstatement period strengthens the fact that the SBA Loan is not anticipated as future assistance. Our household cancelled and refused the SBA Disaster Loan Assistance based on our debt burden which has not changed.
We ask that you help us communicate this issue to HUD CDBG-DR and the State of Louisiana Grantee and it's contractors under the direction of Patrick Forbes Director of the State of Louisiana Office of Community Development Disaster Recovery Unit.
Thank you for your time,