HUD Sued over Katrina funds

Attorneys representing the Mississippi Center for Justice, the Lawyers’ Committee for Civil Rights Under Law, the Mississippi chapter of the NAACP and Gulf Coast Fair Housing Center filed suit against the U.S. Department of Housing and Urban Development on Wednesday, seeking to stop the state of Mississippi from diverting $600 million in federal hurricane-relief funds intended for housing to a massive expansion of the state’s port facilities.

Msnbc.com has obtained a memo from a HUD official that demonstrates concern within the agency over waivers granted by HUD officials and the fund diversions, and raises the specter that they could violate civil rights laws.

Attorneys point out that spending $600 million on the port, which already received insurance money for damage it suffered in the storm, cannot be considered hurricane-related repair because it is more than four times the $127.5 million the port was valued at before Katrina.

Mississippi Governor Haley Barbour stated that a certain amount of the Community Block Grant funds were always intended for economic expansion of Gulfport. But this claim is not substantiated by his earlier testimony before Congress.

The plaintiffs contend that the funds were intended to provide housing for individuals and families who were victims of Hurricane Katrina.

Photo: Governor Barbour addressing the participants of the 2008 Health Insurance Summit, where he discusses the creation of a Mississippi Health Insurance Exchange Program, a major step toward giving employees of small businesses more access to health insurance at more affordable rates.

The entire story can be read here: http://www.msnbc.msn.com/id/28143777/