NJ Lawmakers To Introduce Bills To Prohibit Sandy 'Clawback' Letters

UNION BEACH, N.J. (CBSNewYork/AP) - Two federal lawmakers from New Jersey plan to introduce legislation next week that would prevent the federal government from taking back aid it mistakenly gave to Superstorm Sandy victims.

Sen. Robert Menendez and Rep. Frank Pallone will introduce bills that would prohibit the federal Emergency Management Agency from issuing so-called "clawback'' letters demanding repayment of aid it wrongly awarded to homeowners.

The law would not apply to cases of fraud.

"This is not about fraud, this is about the government making a mistake," Sen. Menendez told WCBS 880's Jim Smith.

Menendez and Pallone's bills would forgive the money for households earning less than $250,000.

"The government shouldn't come back and ask for the money back. It's nmot fair, it's that simple," Pallone said.

They estimate 3,000 homeowners in New Jersey and New York have gotten repayment demands so far.

The Democratic lawmakers say it's designed to help storm victims who applied for aid and were later found to be ineligible or overpaid through no fault of their own.

They say that much of that money has already been spent on repairs.

"To ask them to pay this back now, when the government made a mistake, is in essence going to put them in a situation where they may not be able to sustain their very home," Menendez said.

FEMA has provided more than $1.4 billion in assistance to 182,911 disaster survivors in Connecticut, Maryland, New Jersey, New York and Rhode Island. Two percent of the total number of survivors that obtained assistance received a recoupment letter from the agency, Baker reported.

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