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City has yet to bill state for $3.5 million in Hurricane Ike costs

Friday, January 9, 2009 by Austin Monitor

Even though estimates at the time were much higher, the City of Austin now says it will seek an estimated $3.5 million in reimbursements for assisting Hurricane Ike evacuees last September.


Previously, the city had estimated its costs at $8 million. However, officials had not yet gotten specific instructions from the State of Texas on how to calculate certain items, according to Deputy Chief Financial Officer Jeff Knodel.


“We had not gone through all of our processes and it was an estimate,” Knodel said of the early figure. “That’s why we go through this due diligence. We have to validate if it’s an employee charge; a lot of detail goes into that request. We’d rather go through all that before we submit it to FEMA or the state. We don’t want to bill any that is ineligible.”


Knodel said there was a meeting in December where the state outlined what costs were eligible for reimbursement.


“The majority of the expenses for Hurricane Ike will be reimbursed through the state,” he said. “The way it works is we’re part of a mutual aid request from the state. We were told Austin would be treated as providing mutual aid to the State of Texas, and that eventually they would kick off the official reimbursement process.”


Hurricane Ike made landfall on Sept. 13, 2008 near Baytown as a Category 2 storm, doing heavy damage to Galveston, Houston and other parts of Southeast Texas. FEMA officials estimate that Ike caused more the $27 billion damage in the United States, mostly in Texas, and more than $31 billion total.


Officials estimate that Austin housed as many as 6,000 Ike evacuees in 23 shelters during the time just before through several weeks following the storm. The city spent millions of dollars on cots, mattresses, clothes, food and other essentials to sustain the evacuees during the evacuation.


One major difference between Ike and Hurricane Katrina in 2005 is that while most Katrina expenses were reimbursed to the city by FEMA, expenses for Ike will be reimbursed by the state, Knodel said.


“It’s going to be the state handling the reimbursements for Ike,” he said. “The city plans on submitting the reimbursement request in the next few weeks. I can’t tell yet what the state’s turnaround is going to be. We go through a pretty lengthy process. In addition to that, we had a mutual aid request from the City of Houston, so we have to segregate those billings.”


A variety of city departments – APD, Solid Waste Service, Watershed Protection and others  – sent personnel and assistance to the Houston in the days and weeks following the storm to help with the clean-up and to get vital services back online.


Knodel said the city made what may have seemed like some unusual purchases during the evacuation assistance, but that if they weren’t used in this emergency, they will be available in the future.


That list includes 4,600 air beds for $91,000 (better for gymnasium floors); $27,000 for extra-large (bariatric) hospital beds to handle special needs evacuees; 49 wheelchairs for $10,000; and a bulk purchase of children’s and adult’s underwear for evacuees. (Unused items were returned for about $13,000 store credit.).


The city also purchased more than $10,000 in Visa gift cards to be used by evacuees to shop at Barton Creek Square mall, but never distributed them. Knodel said the city’s Purchasing Office would be using the cards for small dollar purchases in the coming year to save budget dollars.


In November, city officials estimated that they would be seeking about $8 million in Ike reimbursements — $6.2 million in staffing costs, including for city employees who helped staff Austin shelters. It also planned to bill the state for $1.8 million in shelter supplies, such as food, clothing and medicine.


Austin Energy has a separate agreement with Houston’s utility, Centerpoint.


Knodel has adjusted that estimate to $3.5 million now. In 2005, the state and federal government reimbursed the city slightly more than $18 million for Hurricane Katrina.


Knodel said the city spent only about $200,000 in assisting Hurricane Gustav evacuees earlier in the season. The city expects to be asking the state for reimbursement of those expenditures within the next few weeks.

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