[FoCHAT] CHATNews: Road Home and Legal Issues about OCD's Attempts to Get Paybacks from Applicants

[Melanie Ehrlich]

From: Melanie Ehrlich <mehrlich8 at yahoo.com>
Subject: CHATNews: Road Home and Legal Issues about OCD's Attempts to Get Paybacks from Applicants
To: fochat at chatushome.com, "CHAT" <chatlra at yahoo.com>
Date: Monday, June 28, 2010, 8:21 AM







 Janue 28, 2010 
Dear CHAT Members, 
Below are several emails (highlighting added) about legal issues and possible help for income-qualified applicants with Road Home payback issues as well as a TV story about abusing the system by a Mayor Landrieu staff member.   
  
  
From: CHAT [mailto:chatlra at yahoo.com] 
Sent: Friday, June 25, 2010 12:13 AM
To: Rowena Jones
Cc: mehrlich8 at yahoo.com; Frank Silvestri
Subject: Re: RH compliance monitoring & legal options 




Rowena, 
 Frank Silvestri, Esq., Co-Chair of CHAT has pending cases for RH applicant access to court, as I am sure you know because SLLS has worked with Mr. Silvestri on these issues.  How can I encourage applicants to seek legal redress when Mr. Silvestri has not yet won the right to court for his RH applicants that has survived appeals to higher courts? 
  
Response from David Williams: 
Even though we have not obtained a right to court access yet Frank and SLLS are again asking that the state Supreme Court look at the issue (it refused last time).  In addition, there should be a firmer right to access the courts as to recapture, because the agency’s seeking money back from people traditionally counts as “property” entitled to due process, even though the appellate court has so far said that there is no right to due process with regard to whether one gets a grant.  While the question of access to the courts remains open, we have had some success at the agency level, so assisting on the appeals remains important   Our office has not required a failed appeal attempt before helping Road Home applicants, and does not anticipate doing so. 
  
When you mention legal help, perhaps for those asked to payback their grants for lack of  rebuilding in time, I am concerned that there will not be nearly enough free or very low-cost legal  help for them from your fine organization and the others on the list. I have run into the problem before of recommending non-profits, only to frustrate our members who find that they cannot even get timely return of phone calls because of limited staff available.  Please advise me on this matter.  Also, can SLLS help with the recapture attempts? If so, would you consider helping any applicant who has not filled the covenant or only certain classes (such as, failed appeal)? 
  
Response from David Williams: 
We know of no problems with returning calls to our unit that handles Road Home issues.  Persons should call our Unit [Employment & Benefits] directly, through Roseanne Dunns at 504.529.1000 ext. 242.  If there are access problems, please let me know, because we would be very concerned about that and should be able to redress them.  I agree the recovery problems may overwhelm the number of attorneys available to help.  In addition, most CHAT members are probably over-income for our services, which require that income be less than twice the poverty line.  But we do want to help those we can, and by getting into cases early have a better chance of being able to influence how Road Home deals with all cases. 
  
Can I recommend to our members that they could consider a transfer of their home to a first-degree relative (sister, brother, mother, child) and then will not incur the covenant requirement for rebuilding within 3 years? 
This is from the Covenant. 
  




(c) The provisions of this Section 8 shall not apply in the event of a transfer, sale, assignment or other disposition resulting from expropriation, divorce, succession, donation to a lineal relative or bankruptcy of the Owner. 

Response from David Williams: 
 Our reading of the Covenant Provision 8c provision that you ask about is that transfers to a relative and the other listed transfers do not make full repayment immediately “due on sale” (or transfer).  But they do not remove the obligations from the property, so the relative is just as liable to comply as the original recipient was.  
    
Lastly, may I reproduce your email in its entirety with forthcoming clarifications from you in our e-newsletter? 
 Thank you very much for your help, 
  
Melanie Ehrlich 
Co-Chairman, CHAT
--- On Thu, 6/24/10, Rowena Jones <rjones at slls.org> wrote: 

From: Rowena Jones <rjones at slls.org>
Subject: RH compliance monitoring & legal options
To: chatlra at yahoo.com
Date: Thursday, June 24, 2010, 10:20 AM 
Please consider reminding your readers of the need to closely read state/OCD letters to ensure they don’t miss any response and/or appeal deadlines, to keep proof of any response/appeal filed, and to consider legal representation if needed; private attorneys may be available if they can be afforded; many of your readers may be eligible for free legal assistance through law school clinics, free legal aid programs, etc.  10 parish southeastern area covered by Southeast Louisiana Legal Services, www.slls.org; website www.lawhelp.org/LA provides a directory of free legal services programs for all of Louisiana . 
  
Rowena Jones, Managing Attorney 
Employment & Benefits Unit 
Southeast Louisiana Legal Services  
1010 Common, Ste. 1400A 
New Orleans, LA   70112 
  
Intake # for Road Home problems: 
(504) 529-1000, ext. 242 
  
  
>From CHAT Co-Chair Frank Silvestri, who has been working mighty hard trying to secure the right of RH applicants to go to court to challenge mistakes in RH grants. He won in one case but the win was overturned by the Louisiana Supreme Court. 
6/26/10 
The staus of our private right-to-sue cases is that we have been bounced twice and are about to try another writ to the state supreme court to ask that the remedy of judicial review (access to courts) be recognized.  
Frank 
  
http://www.wwltv.com/news/10pm-Woltering-Cortizas-Road-Home-97119809.html 
Mayor Landrieu aide runs afoul of Road Home program 
by Dennis Woltering with reporting by Marcy Planer and Mike Perlstein / Eyewitness News 
wwltv.com 
Posted on June 24, 2010 at 10:36 PM 
Updated Friday, Jun 25 at 6:44 PM 
NEW ORLEANS -- The Road Home program gave Richard Cortizas, executive counsel to Mayor Mitch Landrieu, a $95,000 grant to rehabilitate and move back into his home on Pratt Drive within three years.
That three-year time limit, which Cortizas agreed to meet when he signed Road Home covenants, was up just over a month ago on May 17.
 
Cortizas admits he failed to live up to his part of the agreement.
“It’s my fault and I take full responsibility,” Cortizas said. “I will tell you when I alerted the mayor yesterday of this, he was not happy. I was not happy about it. He instructed me to get the property in livable condition and to do it immediately.    And I am doing that.    And I will do that,” Cortizas said.
Cortizas says he alerted the mayor after being contacted by Eyewitness News. He also sent the Road Home program a letter to ask for an extension.
 
Cortizas says the house is gutted and he has installed a new roof, doors and fencing around the property. But he says his effort to rebuild on Pratt Drive was delayed in part because he bought a house Uptown for $330,500 dollars one year before getting his Road Home grant.
 
“Unfortunately we’ve had a really tough time selling our house Uptown. And that’s been a problem,” he said.
 
Records reveal his Uptown house was on the market from August 2008 until November of last year. It was then pulled off of the market.
 
Cortizas also acknowledges that he got a loan from the Small Business Administration for $25,000.
“A portion of the SBA funds and a portion of the Road Home grant money were actually used to purchase the house that I mentioned that I purchased Uptown,” he said.
 
Cortizas clarified that he received Road Home money after the purchase.
“So I used some of those funds, some of the money that I used to purchase that house.   And I’ve got that very well documented, because obviously I didn’t have the money to purchase that house alone.”
Cortizas says the Road Home grant and the SBA loan were supposed to be used to repair the house on Pratt Drive.
 
WWL asked Cortizas if he violated the rules under which he received that $121,000 in loan and grant funding from the government.
“I’m not so sure that it violated the covenants. Beause the covenants just called for me rehabbing this property,” he said.
 
Research reveals Cortizas has failed to satisfy the terms of a couple of other financial agreements.
His failure to repay the Tulane Educational Fund $8,046.99 in 1991 led to a $10,500 judgment which he finally paid in 2003.
 
And his failure to satisfy the terms of a lease with Ford Motor Company in 2004 led him to pay a judgment of $14,170.02 in 2009.
 
Cortizas was Sen. Mary Landrieu’s regional director, running her New Orleans office from 2001 to 2004. He was president of the Hispanic Chamber of Commerce (before joining the Mitch Landrieu administration) and was a member of Mitch Landrieu’s transition task force on city financial systems.
But he stresses his car and Tulane difficulties happened before he became Mayor Landrieu’s executive counsel.  
      
“Those difficulties did not occur while I was in this position.   Those difficulties, if you will note, were while I was in college,” he said.
 
“It’s very tough to be a Tulane student.   And I actually graduated from Loyola. It’s been a tough time,” he said, though he admitted that the Ford judgment was paid just a year ago, in 2009.
As for his house on Pratt Drive, the Road Home program has issued a directive about getting an extension on a grant.
 
“To request an extension, the homeowner must be able to provide a current building permit to demonstrate that he or she intends to rebuild or repair the home,” the LRA directive states.
Cortizas plans to repair the house with a building permit issued in March 2006.
 
He said he is considering returning either the money or property back to the Road Home.
“Absolutely. My wife and I have talked about it, because we really frankly don’t know what to do now,” he said.
 
Cortizas said he doesn’t think he should be treated any differently than any other Road Home recipient.
“I’m not seeking special treatment. Absolutely not.”
Right now he says his intention is to rehab his house on Pratt Drive just as he told Mayor Landrieu he would.
 
It's not clear if the Road Home program will give Cortizas an extension. A spokeswoman says that the agency can't comment on individual cases due to privacy issues.
 
Have a tip for 4 Investigates?  Click here to submit. 
  
Best wishes, 
  
Melanie Ehrlich 
Co-Chair, Citizens’ Road Home Action Team (CHAT)
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