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FEMA Must Pay $10.8M to New Orleans According to Recent Arbitration Ruling

Monday, September, 9, 2013


According to the Louisiana Weekly, arbitrators with the Washington, D.C.-based Civilian Board of Contracts Appeals (CBCA) have granted New Orleans a $10.8 million settlement to be paid by the Federal Emergency Management Agency (FEMA).  According to the ruling, FEMA had to make good on its promise to pay $10.8 million to the City of New Orleans for emergency work performed by New Orleans police, fire, and emergency medical service personnel during the aftermath of 2005’s Hurricane Katrina.


New Orleans mayor Mitch Landrieu issued a statement saying, “This ruling affirms the hard work put in by so many to serve and protect those in need during our darkest hours.” Those darkest hours to which he refers include an economic crisis that hit the city following the massively destructive hurricane, and the lack of resources within the city to pay for its first responders.


FEMA reneged on its 2009 promise to pay the personnel, stating its policy that forbids reimbursement to cities for permanent employees that assist in an emergency situation overseen by FEMA.  The city disputed the policy and filed a court action in an attempt to hold FEMA to its promises; however, in the meantime, budget cuts were being made in case the arbitration panel ruled against them. 


Specifically, the three-person arbitration panel stated that “Funds were legitimately paid pursuant to an approved agreement. The costs were reasonable, and the purpose of the grant was accomplished.” According to U.S. Senator Mary Landrieu, the panel’s decision reflected “common sense.”  She further stated, “This is why I believed it was so important to create this arbitration panel.”


Deputy Mayor of New Orleans Andy Kopplin stated, “I am grateful to the panel for doing the right thing and to our first responders for their service, both after Katrina and every day. We are grateful that the arbitration panel reviewed those facts and circumstances and recognized that FEMA had been correct in helping the city in the first place.”