FEMA pay puzzles landlord

The owner of the Madeira Beach apartments got two checks but never housed Katrina victims. The $6,000 is being returned.

Published October 4, 2005

MADEIRA BEACH - Liz Taylor opened her mother's mail last week to find two checks worth nearly $6,000 from the Federal Emergency Management Agency.

The checks were written to Sandcastle Apartments, owned by Taylor's mother, for housing Hurricane Katrina evacuees.

But the two Madeira Beach units haven't housed any evacuees.

"I was shocked when they came, and certainly I never considered cashing them," said Geraldine Taylor, 86. "The way it was written out, I could have cashed it!"

She asked her daughter to investigate.

Liz Taylor, 47, of Tampa sent an e-mail to Corporate Lodging Consultants of Wichita, Kan., which sent the checks. The consulting company works for the American Red Cross, which FEMA uses to administer a lodging reimbursement program.

Kyle Rogg, Corporate Lodging senior vice president, saw the e-mail from Liz Taylor with the subject line, "Wrong Check." He called her back within minutes.

"Our preference would be that situations like this never happened," Rogg said Monday.

Corporate Lodging claims to be the largest negotiator of hotel contracts in North America.

The Red Cross turned to the consulting group to develop a plan to house an estimated 250,000 Hurricane Katrina evacuees in about 42,000 hotel rooms across the nation.

When penniless evacuees come into qualifying hotels, the hotels check the evacuees' identification and ZIP code to make sure they are from declared disaster areas.

Then, the hotels send Corporate Lodging the bill via a company Web site.

In the Taylors' case, Rogg said, a hotel he would not identify made a mistake while filling out online forms for reimbursement.

That's how the checks landed in Geraldine Taylor's mailbox.

Strangely, the hotel that erred wasn't near Sandcastle Apartments. It didn't have a similar name. Nor did it have a similar hotel number in Corporate Lodging's database, which keeps a list of 8,000 nationwide hotels for this program, including Madeira Beach's Sandcastle Apartments.

"It's a mystery in the sense that somebody had to click "OK' on the screen and should not have," Rogg said.

He said it was further puzzling because the online reimbursement process includes a screen in which a user can double-check the information to be sure they'll be getting a FEMA reimbursement.

"It still doesn't make any sense to me that her address would get entered," Liz Taylor said.

Her mother agreed.

"I'm completely bewildered as to how I received checks like that, and if I received checks like that, probably other people did too," Geraldine Taylor said.

It's not the first time FEMA has come under fire for misallocating disaster funds.

Earlier this year, congressional investigators found fault in much of the $31-million that FEMA paid to Miami-Dade County residents after Hurricane Frances, which made landfall more than 100 miles north.

But Rogg said mistakes like the one in the Taylors' case have occurred less than five times out of tens - if not hundreds - of thousands of Katrina reimbursements.

"A handful have happened like this, and they usually come to light exactly as this one did," he said.

If the Taylors hadn't notified Corporate Lodging of the mistake, Rogg said, the hotel that didn't receive its $77-a-night lodging reimbursements could have called the company. The checks would have been found, Rogg said, because the reimbursement system tracks everything.

"It's a rare situation. I'd like to say the system is perfect, but it's as near perfect as we can make it," said Rogg, whose company processes payment for more than 7-million hotel rooms annually.

Reached late Monday, FEMA officials were unaware of the situation and couldn't comment.

Liz Taylor was given the option of voiding the checks, faxing copies back to Corporate Lodging or just ripping them up.

Her mother has thought of offering her units up to hurricane evacuees. But she said she worried she might be stuck with permanent residents who couldn't afford to pay rent when she survives off the rental income and Social Security.

She wonders who may have signed her units up for possible evacuee housing.

"I don't even know where they got my name," Geraldine Taylor said. "It's very strange."

Sandcastle Apartments landed on Corporate Lodging's list because the company uses a number of national data sources to get a list of hotels, Rogg said. After Hurricane Katrina, which put 400,000 evacuees in hotels, they needed as broad a list as possible.

That's fine with Liz Taylor. She just wants to make sure it's going to the right hotel.

"There are so many hurricane victims in need," she said. "We wanted the money to go to them."

--Justin George can be reached at 813 226-3368 or jgeorge@sptimes.com Times researchers Angie Drobnic Holan and Cathy Wos contributed to this report.