Association for Public Policy Analysis & Management

Background: The costliest hurricane in U.S. history, Katrina hit the entire New Orleans metropolitan statistical area (NOMSA) in 2005, killing nearly 1,000 people and damaging more than 250,000 homes (Plyer, 2015). Nevertheless, ten years later, the speed of housing recovery for native homeowners of different racial groups, and its relationship to the major public and private financial assistance provided in NOMSA is not yet known.

According to Quarantelli (1995) housing recovery is defined as “disaster victims returning either to repair or rebuild their original homes or moving into new quarters in their community.” Previous research found that the pre-disaster socio-demographic structure predisposed some households to slower recovery (Finch, Emrich & Cutter, 2010). This study explores whether the distribution of homeownership based public financial assistance, National Flood Insurance Program (NFIP) and Road Home Grant (RHG) or private financial assistance Homeowner Insurance (HI), more likely determines the speed of home recovery and addresses housing needs equitably across racial groups.

Research Questions: To what extent does access to major public and private financial assistance programs impact the speed of home recovery for different racial groups?

Method: Using data collected by the American Housing Survey in the New Orleans metropolitan statistical area in 2004 and 2009 (N= 1,177), we study rebuilding and repairing speeds in relation to racial groups whose homes were damaged by Hurricane Katrina. We use Kaplan-Meier estimates to plot the instantaneous speeds of rebuilding and repairing for Black and non-black homeowners with different times, in four types of events: 1) starting to rebuild; 2) starting to repair; 3) completing the rebuild; and 4) completing repairs. The study also adopts Cox regression to investigate the effects of major public and private financial assistance and race upon the time each type of event takes to happen.

Findings: The findings from our event history analysis are: 1) The homeowners that received NFIP assistance more quickly started rebuilding their damaged homes than the owners without this federal support when controlling for family income in 2004; 2) The homeowners that received HI assistance more quickly completed their rebuilding and repairing than those without such private assistance; 3) Black homeowners are less likely to receive HI and NFIP than non-black homeowners; 4) Black homeowners are more likely to receive RHG and experience a delay in starting to rebuild and repair their damaged homes than non-black homeowners. This delay is largely due to the fact that the application for RHG opened over a year after the disaster; 5) However, racial disparities in completing the rebuild and repairs disappear when controlling for damage level and family income in 2009, as well as major financial assistance provided in NOMSA.

Implications: The unequal access of private financial assistance programs, and the “un-timely administration” of public program provision in NOMSA retard the home recovery of Black homeowners as compared to non-black homeowners. Policy makers should rise to the challenge to make financial resources available in a timely manner to facilitate similar starting times and completion of housing recovery.